Under both perfect competition and monopoly, a firm:
A. faces a perfectly elastic demand curve.
B. maximizes profit by setting marginal cost equal to marginal revenue.
C. sells at a price equal to the minimum average total cost.
D. sells at a price equal to marginal cost.
Answer: B
You might also like to view...
The price of a coupon bond and the yield to maturity are ________ related; that is, as the yield to maturity ________, the price of the bond ________
A) positively; rises; rises B) negatively; falls; falls C) positively; rises; falls D) negatively; rises; falls
The portion of planned aggregate expenditure that is independent of output is called ________ expenditure.
A. potential B. actual C. planned D. autonomous
A Jackson Pollock painting can cost $1.2 million, whereas a poster reproduction of the same painting costs only about $15. The reason is that:
A. the total utility of Jackson Pollock paintings is greater than the total utility of Jackson Pollock posters. B. the opportunity cost of Jackson Pollock paintings is greater than the opportunity cost of Jackson Pollock posters. C. Jackson Pollock paintings have more substitutes than Jackson Pollock posters. D. the marginal utility of Jackson Pollock paintings is greater than the marginal utility of Jackson Pollock posters.
An open market ________ by the Fed decreases interest rates and ________ investment.
A. purchase; increases B. purchase; decreases C. sale; increases D. sale; decreases