Suppose that price is below the minimum average total cost (ATC) but above the minimum average variable cost (AVC), and the market price is expected to rise at least to ATC in the near future. In the short run, a firm that is a price taker would:
a. immediately shut down and get out of the industry.
b. continue to produce a quantity such that marginal revenue equals marginal cost.
c. shut down temporarily, in hopes of restarting in the near future.
d. cut price and expand output in hopes of achieving economies of scale
b
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Refer to Table 9-12. Prior to trade, what was the opportunity cost to produce 1 belt in Morocco?
A) 1/2 of a sword B) 1 sword C) 1.5 swords D) 2 swords
Which of the following program(s) is (are) in-kind assistance to fight poverty in the United States?
a. b and e. b. Medicaid. c. Unemployment benefits. d. Temporary Assistance to Needy Families (TANF). e. SNAP (food stamps).
Expansionary fiscal policy when the economy is below full employment _______ aggregate demand and real GDP, and the price level _________.
Fill in the blank(s) with the appropriate word(s).
Suppose you are the marketing manager for Fruit of the Loom. An individual's inverse demand for Fruit of the Loom women's underwear is estimated to be P = 25 ? 3Q (in cents). If the cost to Fruit of the Loom to produce an item of women's underwear is C(Q) = 1 + 4Q (in cents), compute the number of women's underwear items that should be packaged together.
A. 7 B. 1 C. 4 D. 3