When a purely competitive industry is in long-run equilibrium, which statement is true?
A. Marginal revenue is greater than price.
B. Price and average total cost are equal.
C. Marginal cost is at its maximum level.
D. Average total cost is less than marginal cost.
Answer: B
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To achieve long-run equilibrium in an economy with a recessionary gap, without the use of stabilization policy, the inflation rate must:
A. not change. B. increase. C. decrease. D. either increase or decrease depending on the relative shifts of AD and AS.
In Munn v. Illinois (1877), the Supreme Court held that:
a. state laws limiting prices charged by grain elevators were a violation of the Fifth Amendment. b. grain elevator and freight prices could only be regulated by the federal government. c. states have a right to regulate businesses within the state that are "clothed with a public interest.". d. organizations like the Grangers violated federal conspiracy laws.
Other things being equal, the behavior of a monopolist differs from that of a competitive industry in that
A) the monopolist does not attempt to maximize economic profit. B) the monopolist hires more labor. C) the monopolist restricts output and hires less labor. D) the monopolist must consider fixed costs in deciding the optimal level of output to produce in the short run.
If the price of pesos in dollars is $0.10,
A. the price of dollars in pesos is 10. B. the price of dollars in pesos is 1. C. the price of dollars in pesos is 1/10. D. the price of dollars in pesos cannot be determined.