Which of the following statements is true?
A. To maximize profits, a firm must maximize total revenue.
B. In long-run equilibrium, a competitive firm produces at the point of minimum average total cost.
C. In the short-run, a perfectly competitive firm produces where total cost is minimum.
D. In the short-run, a perfectly competitive firm will close down whenever price is less than average total cost.
Answer: B
You might also like to view...
The risk structure of interest rates refers to
A) the amount of additional interest necessary to compensate savers for the greater risk of default on some bonds. B) the relationship among the interest rates on similar bonds with different maturities. C) the relationship among the interest rates on bonds with the same maturity. D) the amount of additional yield necessary to compensate savers for the lesser liquidity of some bonds.
Which regulatory commission helps legislators write command-and-control policies?
a. CAB b. FTC c. EPA d. FDA
Why is the paradox of thrift considered to be a paradox? Because an increase in saving causes
a. consumption to fall, causing the equilibrium level of national income to fall, thus leaving saving unchanged or even lower b. consumption to also rise, causing the equilibrium level of national income to rise, resulting in higher than anticipated saving c. investment to also rise, causing the equilibrium level of national income to rise,resulting in higher than anticipated saving d. investment to fall, causing the equilibrium level of national income to fall, thus leaving saving unchanged e. consumption to fall, causing the equilibrium level of national income to rise, resulting in higher than anticipated saving
The 2002–2008 OPEC price increases caused by conflict in the Middle East caused the aggregate
A. demand curve to shift outward. B. demand curve to shift inward. C. supply curve to shift outward. D. supply curve to shift inward.