Consider a firm with the following cost information: ATC = $15, AVC = $12, and MC = $14 . If we know that this firm has decided to produce Q = 20 by following the rule to maximize profits or minimize losses, then the price of the output is
a. $12
b. $14
c. $15
d. $20
e. indeterminate from the information given
B
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Suppose that an indifference curve for Jack is drawn measuring quantities of pencils along the horizontal axis and quantities of pens along the vertical axis. If the marginal value of an additional pencil is 3 pens for Jack, the slope of his indifference curve in this range is
a. 1/3. b. 3. c. 6. d. dependent upon the prices of the two goods
Among a set of alternatives with the same benefits, an individual is said to optimize if she chooses an alternative that:
A) has the lowest total cost. B) has the highest total cost. C) has the highest indirect cost. D) has the lowest opportunity cost.
Which of the following price indices is the best measure of the cost of living of the typical household?
A. GDP deflator B. producer price index C. consumer price index D. household price index
Suppose over some period of time the money supply tripled, velocity was unchanged, and real GDP doubled. According to the quantity equation the price level is now
a. 6 times its old value. b. 3 times its old value. c. 1.5 times its old value. d. 0.75 times its old value