To maximize profit, a perfectly competitive firm
A) should sell the quantity of output determined by the interaction between industry demand and supply.
B) should produce the quantity of output that results in the greatest difference between marginal revenue and marginal cost.
C) should sell the quantity of output that results in a value for total revenue that is equal to total cost.
D) should produce the quantity of output that results in the greatest difference between total revenue and total cost.
D
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An increase in net exports will have a greater effect on equilibrium real GDP if the
A. marginal propensity to consume is smaller. B. average propensity to consume is larger. C. marginal propensity to save is larger. D. marginal propensity to save is smaller.
An import quota taxes an import but does not set a limit on how much may be imported
a. True b. False
Government transfer payments are a good example of an automatic stabilizer
a. True b. False Indicate whether the statement is true or false
A firm has $300 million in revenues and explicit costs of $100 million. If its owners have invested $150 million in the company at an opportunity cost of 10 percent a year, the firm's accounting profit is: a. $50 million
b. $150 million. c. $185 million. d. $200 million.