According to the profit effect,
A. Some costs do not rise when average prices rise.
B. The aggregate supply curve is vertical in the short run.
C. All costs rise when average prices rise.
D. The aggregate supply curve has a negative slope.
Answer: A
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Refer to the scenario above. How will the demand for pens faced by the existing pen manufacturers in Eduland be affected if new firms enter the industry in the long run?
A) The demand faced by the existing firms will become perfectly inelastic. B) The demand faced by the existing firms will become perfectly elastic. C) The demand faced by the existing firms will increase. D) The demand faced by the existing firms will decrease.
For a competitive firm,
a. total revenue equals average revenue. b. total revenue equals marginal revenue. c. total cost equals marginal revenue. d. average revenue equals marginal revenue.
The only means available to increase capital stock is through ____________.
Fill in the blank(s) with the appropriate word(s).
Using productive resources to make capital goods requires that we
A) get everyone to agree on the best use of those resources. B) get government approval of our plan to make capital goods. C) forgo some level of current consumption. D) prove that the existence of the capital goods will not cause any environmental damage.