Assuming there are no externalities, if a firm is producing at an output level where the benefits to consumers are less than the cost to the suppliers to produce it, then price
A. is less than marginal cost.
B. is greater than marginal cost.
C. is less than marginal revenue.
D. equals marginal cost.
Answer: A
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Economic profit is
A) revenue - variable costs + fixed costs. B) revenue + variable costs - fixed costs. C) revenue - variable costs - fixed costs. D) revenue/cost of capital.
If you are faced with the choice of receiving $500 today or $800 6 years from today, you will be indifferent between the two possibilities if the interest rate is 8.148 percent
a. True b. False Indicate whether the statement is true or false
Moral hazard can be avoided by:
A. removing the asymmetric information. B. employers monitoring employee effort. C. employers incentivizing employees to maintain consistent effort. D. All of these statements are true.
A shift from S1 to S2 reflects the change that happens when a negative externality is taken into account. A shift from D1 to D2 reflects the change that happens when a positive externality is taken into account.Refer to above figures. Prior to the shift of the curves, which panel and which curve involve the existence of negative externality?
A. Panel 1 and S1 B. Panel 1 and S2 C. Panel 2 and D1 D. Panel 2 and D2