A wheat farmer and a firm in a perfectly competitive market are similar in that
A) both face vertical demand curves.
B) both have to lower their prices if a rival firm lowers its price.
C) both face horizontal demand curves.
D) both will earn an economic profit if their total revenue equals their total cost.
Answer: C
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The General Motors Acceptance Company (GMAC) is a
A) sales finance company. B) consumer finance company. C) business finance company. D) public finance company.
How might a restaurant manager use the concept of diminishing marginal utility to increase sales to her regular dinner customers?
a. She could expand the variety of options available at each price point on the dinner menu. b. She could increase portion size without raising the price of the dinner menu items. c. She could offer premium versions of dinner menu items to make the regular items seem more affordable. d. She could offer a discount on dessert only to people who order dinner.
The correct formula that relates present value (PV) to future value (FV), if interest rate is i% per year over n years is:
A. PV = FV (1 + i)n B. FV = PV (i)n C. PV = FV/(1 + i)n D. FV = PV (1 + i) (n)
The expression, "There's no such thing as a free lunch" implies that: a. everyone has to pay for his/her own lunch
b. the person consuming a good must always pay for it. c. costs must be incurred when resources are used to produce goods and services. d. no one has time for a good lunch anymore.