A perfectly competitive firm is producing zero units of output in the short run. We know that price is
A. below the minimum point of its average fixed cost curve.
B. between the minimum points of its average total cost curve.
C. below the minimum point of its average variable cost curve.
D. below the minimum point of its average total cost curve.
Answer: C
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An increase in the price level leads to a
A) leftward shift in the demand for money curve. B) rightward shift of the supply of money curve. C) movement downward along the demand for money curve and no shift of the curve. D) movement upward along the demand for money curve and no shift of the curve. E) rightward shift in the demand for money curve.
Assuming there are no capital gains, a nation's wealth at the start of a year is equal to the wealth at the start of the previous year plus
A) income. B) nothing because wealth does not change from one year to the next. C) income minus saving during the year. D) saving during the year. E) saving minus depreciation during the year.
Opportunity cost is always measured in dollar terms, rather than in terms of real goods and services
a. True b. False
Assuming that bus travel is an inferior good, a decrease in consumer income, other things being equal, will cause
a. a downward movement along the demand curve for bus travel. b. no change in the demand curve for bus travel. c. an upward movement along the demand curve for air travel. d. a rightward shift in the demand curve for bus travel.