Which of the following examples gives an accurate reason for a firm to shut down?
a. Bertrand shuts down his hobby shop because TR > VC.
b. Joan decides to shut down her coffee shop because P < AVC.
c. Juan shuts down his restaurant because P < ATC.
d. Chen shuts down his bakery because TR > MC.
b. Joan decides to shut down her coffee shop because P < AVC.
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If total Fed liabilities __________, then reserves have to __________, everything else being equal
A) fall; rise B) rise; rise C) fall; fall D) None of the above.
What is the long-run effect on the demand curve of a monopolistically competitive firm when more firms enter the market?
A. Demand curve shifts to left. B. Demand curve remains the same. C. Demand curve shifts to right. D. Demand curve become flatter.
If you want to know the long-run equilibrium output of one perfectly competitive firm, and you are permitted to see only one curve, which one below is most helpful?
A. Demand B. Marginal Cost C. Average total cost D. Average Fixed cost E. Average Variable cost
Import quotas on sugar may cost consumers $2 billion per year. But this quota goes unchallenged because the $10 average annual cost per person is so small that probably not one voter in 200 knows the quota exists. This statement describes:
A. the voting paradox. B. the special-interest effect. C. the median-voter model. D. free-rider problem.