In the short-run, an increase in the average price level in the economy will cause:
a. demand for a good to increase but total production to decline.
b. profits to rise and thus, total production to increase.
c. interest rates to fall and thus, total production to decline.
d. input costs to fall and thus, total production to rise.
e. input costs to fall and thus, total production to decline.
b
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The figure above shows a perfectly competitive firm. If the market price is $20 per unit, then the firm produces ________ units and makes an economic profit that is ________
A) more than 30; more than $100 B) 30; more than $100 C) 20; less than $400 D) 0; zero E) 30; zero
“If it were not for the law of diminishing marginal returns, the world’s wheat could be grown in a flower pot.” Explain.
What will be an ideal response?
Refer to the information provided in Figure 2.5 below to answer the question(s) that follow.
Figure 2.5Refer to Figure 2.5. The marginal rate of transformation in moving from Point A to Point B is
A. -2/3. B. -1.5. C. -3. D. -30.
Refer to the graphs below. Which graph shows a change in the buyer's income, but no changes in the prices of X and Y?
A. Graph A
B. Graph B
C. Graph C
D. Graph D