A picture frame company operates in a competitive price-searcher market. Its short-run equilibrium price is $80 and its ATC is $65 . It sells 100 picture frames a week. From this we can conclude
a. this firm is making a normal profit.
b. other picture frame companies will want to exit the market.
c. there are no other picture frame companies in the area.
d. economic profits are $1,500.
e. total profits are being maximized.
D
You might also like to view...
The invocation of beggar-thy-neighbor arguments with respect to industrial policies
A) strengthens the argument for subsidies. B) makes sense if the international Keynesian multipliers exceed unity. C) applies only to rich countries most of whose trade partners are very poor countries. D) weakens the argument for subsidies. E) does not apply to rich countries who can influence relative world prices.
An increase in the money supply is represented by a(n):
a. rightward shift of the downward-sloping money supply curve. b. upward shift of the money supply curve. c. rightward shift of the money supply curve. d. increase in the rate of interest.
Which of the following statements is correct?
a. The benefits that accrue to a monopoly's owners are equal to the costs that are incurred by consumers of that firm's product. b. The deadweight loss that arises in monopoly stems from the fact that the profit-maximizing monopoly firm produces a quantity of output that exceeds the socially-efficient quantity. c. The deadweight loss caused by monopoly is similar to the deadweight loss caused by a tax on a product. d. The primary social problem caused by monopoly is monopoly profit.
The domestic demand and supply for sugar are Qd = 40,000 ? 200P and QSD = 10,000 + 300P. The foreign supply is QSF = 20,000 + 100P. What is the total supply of sugar in the domestic market?
A. Q = 15,000 + 200P B. Q = 10,000 + 300P C. Q = 50,000 + 100P D. Q = 30,000 + 400P