Which of the following could generate economic profits for perfectly competitive firms in the short run, if they initially earn zero economic profits?
A. an increase in total fixed costs
B. a fall in demand
C. a unit tax on output
D. a decrease in input prices
Answer: D
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Explain how our economic welfare depends upon our level of real GDP per person but there might not be a one-to-one relationship between economic welfare and real GDP per person. Give examples of things that can effect one but not the other
What will be an ideal response?
Why is the supply curve vertical in this graph?
a. Q1 is fixed.
b. The movement from P1 to P2 is slight.
c. The movement from P1 to P2 is more than 10 percent.
d. Q1 increases upwards, not horizontally.
Global capital flows have completely broken the link between domestic savings and domestic investment
Indicate whether the statement is true or false
Assume that one day's labor in England can produce either 20 units of cloth or 2 units of wine, while in Portugal, one day's labor can produce either 24 units of cloth or 12 units of wine. If England transfers 2 units of labor from wine to cloth and Portugal transfers 1 unit of labor from cloth to wine, the increase in combined output by those two workers will be
a. 16 wine, 8 cloth b. 16 wine, 16 cloth c. 12 wine, 12 cloth d. 8 wine, 16 cloth