Figure 6.3 shows the cost structure of a firm in a perfectly competitive market. If the market price is $6, then the firm will:
A. be better off producing 150 units than shutting down.
B. be better off exiting the market and using the resources for other production activities.
C. be better off shutting down in the short run and waiting until the market price rises above $10.
D. None of these
Answer: B
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The Internet has created a new category in the book selling market, namely, the "barely used" book. How does the availability of barely used books affect the market for new books?
A) The demand curve for new books shifts to the right. B) The supply curve for new books shifts to the left. C) The demand curve for new books shifts to the left. D) The supply curve for new books shifts to the right.
Suppose the consumer's income increases while the prices of the goods remain constant. Then the
A) budget constraint shifts outward parallel to the original budget constraint. B) indifference curves become flatter. C) budget constraint shifts inward parallel to the original budget constraint. D) indifference curves shift outward away from the origin.
Price floors keep the price _____ equilibrium price; price ceilings keep price _____ equilibrium price.
Fill in the blank(s) with the appropriate word(s).
Angie's list now provides a rating service for physicians. This type of information can potentially help consumers in which stage of the consumer decision making process?
External search Post purchase evaluation Problem recognition Internal search