For a perfectly competitive firm, the market price of a good is
A) a given which the firm cannot change.
B) determined by the firm in order to maximize its profit.
C) equal to the firm's marginal revenue.
D) Answers A and B are correct.
E) Answers A and C are correct.
E
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The above figure shows Dana's marginal benefit curve for ice cream. If the price of ice cream is $2 per gallon, then Dana's consumer surplus from the 4th gallon
A) is greater than her consumer surplus from the 8th gallon. B) is the same as her consumer surplus from the 8th gallon. C) is less than her consumer surplus from the 8th gallon. D) could be greater than, equal to, or less than the consumer surplus from the 8th gallon.
In the current debate over fiscal policy, advocates of returning to significant budget surpluses
A) contended that the economic miracle of the late 1990s caused the budget surpluses. B) think that tax cuts will benefit the wealthy. C) believe that tax cuts will continue the dependence of the United States on borrowing from foreigners. D) All of the above.
Securities exchanges pay no attention to hedge funds
a. True b. False
Suppose that if the price of plane tickets increased, more people would choose to travel by train. If this happened, you would know that:
A. the cross-price elasticity between plane tickets and train tickets is negative. B. plane tickets are an inferior good. C. the cross-price elasticity between plane tickets and train tickets is positive. D. plane tickets and train tickets are complements.