If a perfectly competitive firm charges a price that is equal to its average total cost:
A. the firm is earning an economic profit equal to zero.
B. the firm is earning an economic profit greater than zero.
C. the firm is earning an economic profit less than zero.
D. It is not possible to determine anything about the firm's profits.
Answer: A
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If you put a $20 bill in the pocket of your winter coat at the beginning of spring so that you will be surprised when you find it again next winter, you are using money as
A. a unit of account. B. a store of value. C. a medium of exchange. D. bank reserves.
Final goods and services refer to:
a) goods and services that are unsold and therefore added to inventories. b) goods and services whose value has been adjusted for changes in the price level. c) goods and services purchased by ultimate users, rather than for resale or further processing. d) the excess of U.S. exports over U.S. imports.
Evidence shows that the Chinese yuan was substantially overvalued against the U.S. dollar in mid-2005.
Answer the following statement true (T) or false (F)
Each of the following statements describes how the political and legal environment encourages productivity except:
A. Political stability promotes economic growth. B. Well-defined property rights encourage production and saving. C. Price changes in markets give suppliers incentives to supply goods to markets. D. Pay rates determined by a governmental planning agency provide workers with stronger incentives to work hard than market wages.