Suppose that the current equilibrium price of silver is $20 per ounce. If silver is produced under conditions of perfect competition and the industry is in long-run equilibrium, the average total cost of producing silver:
A. exceeds $20 per ounce.
B. is less than $20 per ounce.
C. is $20 per ounce.
D. is indeterminate.
Answer: C
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a. True b. False Indicate whether the statement is true or false
Which of the following is the most frequently used tool of monetary policy?
A. Changing the discount rate B. Changing reserve requirements C. Open-market operations D. Interest rate changes
A lighthouse that serves a dangerous coastal area is built. The lighthouse cost $2 million to build and serves 100 ships a month. If the shipping in the area increases so that 300 ships pass by a month, the increase in additional costs of providing the light to these new ships is
A. $0. B. $5,000. C. $2 million. D. $100,000.
Refer to the information provided in Figure 5.4 below to answer the question(s) that follow.
Figure 5.4Refer to Figure 5.4. The demand for milkshakes is unit elastic at Point C. If the milkshake price falls from P1 to P2, total revenue will
A. either increase or decrease. B. decrease. C. increase. D. remain constant.