If the price of a product falls below average total cost in the short run, the firm
a. has an economic profit
b. cannot cover total fixed costs
c. experiences a loss
d. must always shut down
e. should expand output until MC = MR
C
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Which of the following functions of money would be violated if inflation were high?
a. unit of account b. store of value c. certificate of gold d. medium of exchange
According to the BEA, in the second quarter of 2012 purchases of new residential structures rose by 8.9 percent. Using the expenditure approach, this change increases
A) gross private domestic investment. B) government expenditure on goods and services. C) net exports of goods and services. D) personal consumption expenditures.
The figure above provides information about Light-U-Up Utilities, which is a natural monopoly that provides electricity. What is the area of deadweight loss when Light-U-Up is regulated and follows an average cost pricing rule?
A) acg B) degf C) deg D) There is no deadweight loss.
Assume that autonomous consumption equals $200 and that the mpc equals 0.8. If disposable income equals $1000, then total consumption equals
A) $80. B) $200. C) $800. D) $1000.