In the short run, the profit-maximizing firm will ______
A. break even if marginal revenue equals marginal cost
B. make an economic profit if marginal cost is less than average total cost
C. incur an economic loss if average fixed cost exceeds marginal revenue
D. incur an economic loss if average total cost exceeds marginal revenue
D The firm's marginal revenue equals its price, so answer D is correct because in the case described by answer D, the firm's average total cost exceeds its price.
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Indicate whether the statement is true or false
If a British automobile sells for £20,000 and the British pound is worth $1.50, then the dollar price of the automobile is
A) $1.60. B) $12,500. C) $20,000. D) $30,000.
In the New Keynesian open economy model, government spending
A) is an effective stabilization tool with a flexible exchange rate, and an ineffective stabilization tool with a fixed exchange rate B) is an ineffective stabilization tool with a flexible exchange rate, and an effective stabilization tool with a fixed exchange rate; prices are flexible. C) is an ineffective stabilization tool with a flexible exchange rate, and an ineffective stabilization tool with a fixed exchange rate; net exports depends on the relative price of foreign goods to domestic goods. D) is an effective stabilization tool with a flexible exchange rate, and an effective stabilization tool with a fixed exchange rate.
The Glass-Steagall Act of 1933 separated commercial banks from most of their securities business
Indicate whether the statement is true or false