Assume a perfectly competitive firm is in long-run equilibrium and there is a decrease in market demand for the firm's output. Which of the following will occur?
A) Existing firms will maintain the original level of output, but they will shift their cost functions down in the short run.
B) Existing firms will raise price to cover the reduction in quantity demanded and maintain total revenue in the short run.
C) Existing firms will reduce output in the short run.
D) Market price will be above its original level
Ans: C) Existing firms will reduce output in the short run.
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An example of organizational architecture based on customer type is when divisions are defined as
a. R&D, Engineering, Production, Marketing, Sales b. Component 1 Plant, Component 2 Plant, Component 3 Plant, Final Assembly c. Store 1, Store 2, Store 3, Region A, Region B, Sales Division d. Business Customers, Educational Customers, Household Customers
Other things remaining the same, if a nation's expected price level rises, the demand to hold money:
a. Falls. b. Rises. c. Does not change.
Refer to the data in Figure 22.1. The total fixed costs for this firm are approximately
A. $600. B. $50. C. $100. D. $200.
China's current rate of GDP growth is quite rapid. Its current growth rate is probably three times that of the United States. However, the levels of pollution are much higher in China. Would you consider China to be better off than the United States
given this information? Why or why not? What will be an ideal response?