Letters are used to represent the terms used to answer this question: price (P), quantity of output (Q), total cost (TC) and average total cost (ATC). Which of the following equations is equal to a firm's profit?
A) P - ATC B) (P × Q) - (P × ATC)
C) P - TC D) (P × Q) - TC
D
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Refer to the figure above. Which of the following statements are true in this case?
A) P1 is the socially optimal price for Good X. B) P2 is the price of Good X in a free market. C) Q2 is the efficient level of output of Good X. D) Q2 is the quantity supplied of Good X in a free market.
Net exports is negative if
A) the value of exports exceeds the value of imports. B) the value of imports exceeds the value of exports. C) the tariff payments are included in the value of imported and exported items. D) too much production occurs in the exporting country during the year.
If the world real interest rate were 6% and the domestic real interest rate in Denmark was 9%, borrowers in Denmark would borrow at the rate of ________ and lenders in Denmark would lend at the rate of ________
A) 6%; 6% B) 6%; 9% C) 9%; 6% D) 9%; 9%
In terms of market failure, what is meant by monopoly?
a. The government holds the power to control prices, lower unemployment, or reduce inflation. b. Most of the resources in an economy are controlled by CEOs and other business executives. c. Technological change spurs significant growth in one economic sector while leaving others unchanged. d. One seller dominates a market and excludes others from participating in mutually beneficial exchange.