Once a firm has selected a price for its product, quantity is decided by consumers and their demand curves.
Answer the following statement true (T) or false (F)
True
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In the figure above, what is the slope of the curve at point A?
A) 0.75 B) -0.75 C) 1.33 D) -1.33 E) zero
Suppose that capital and labor must be kept in a fixed proportion to produce a particular good. For example, digging a trench requires one worker who has one shovel. What does this imply about returns to scale?
A) There are constant returns to scale. B) There are increasing returns to scale. C) There are decreasing returns to scale. D) Nothing.
If a firm hires 215 workers it will produce 3,016 units of output. If it hires 216 workers it will produce 3,128 units of output. The marginal physical product of labor equals
A) 1. B) 112. C) 216. D) 3,128.
If the profit-maximizing quantity of production for a competitive firm occurs at a point where the firm's average total cost of production is falling as production increases, then the firm
a. will be earning positive economic profit at the profit-maximizing quantity. b. will have economic profit less than zero at the profit-maximizing quantity. c. will have zero economic profit at the profit-maximizing quantity. d. should increase the quantity of production to increase profit.