If a potato farmer expands output, he finds that the increase in total revenue is less than the increase in total costs. This means that:
a. profit is being maximized.
b. he should not have expanded output.
c. he should produce even more output.
d. the firm is wasting resources.
e. the farmer should go out of business.
b
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What will be an ideal response?
Suppose, at a given federal funds rate, there is an excess supply of reserves in the federal funds market
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Producer surplus is equal to
A) the area under the supply curve. B) the difference between price and average cost for all units sold. C) the difference between price and marginal cost for all units sold. D) the firm's profit when fixed costs exist.
Assuming that chicken and beef are substitutes, a decrease in the price of beef, other things being equal, will:
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