Suppose a perfectly competitive firm faces the following short-run cost and revenue conditions: ATC = $6.00; AVC = $4.00; MC = $3.50; MR = $3.50. The firm should
A) increase output.
B) increase price.
C) remain at the same position.
D) shut down.
D
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If the price elasticity of supply equals zero, this implies that:
a. suppliers can easily change the quantity supplied of the product as the price of the product changes. b. the period under consideration is a very long-run time period. c. the supply curve is perfectly vertical. d. the percentage change in quantity supplied exceeds the percentage change in product price. e. the percentage change in quantity supplied equals the percentage change in product price.
Suppose it takes Dan 5 minutes to make a sandwich and 15 minutes to make a smoothie, and it takes Tracy 6 minutes to make a sandwich and 12 minutes to make a smoothie. Which of the following statements is correct?
A. Dan should specialize in sandwiches, and Tracy should specialize in smoothies. B. Dan should specialize in both sandwiches and smoothies. C. Dan should specialize in smoothies, and Tracy should specialize in sandwiches. D. Tracy should specialize in sandwiches and smoothies.
One explanation given in the video for the fluctuations of an economy's real growth rate around its potential growth rate is:
A. that there are often shocks to the planned level of spending. B. that there are often shocks to the money supply. C. that the potential growth is inaccurately calculated. D. that there are often shocks to the key growth factors
The behavior of profit-maximizing producers is guided by
A. Philanthropy. B. Social costs. C. Self-interest. D. Aesthetic concerns.