If a firm is producing an output rate at which marginal cost is equal price, the firm
A) is maximizing profits.
B) should increase its output level.
C) should reduce its output level.
D) will not be covering its fixed cost.
Answer: A
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Price-discriminating, profit-maximizing monopolists charge higher prices to buyers who have more elastic demand curves
a. True b. False
The distinction between exogenous and endogenous variables is important because:
a. Endogenous variables are fixed by definition. b. Exogenous variables are fixed by definition. c. Endogenous variables are determined within the Three-Sector-Model while exogenous variables are not. Endogenous variables are therefore treated as shocks to the Three-Sector-Model. d. Endogenous variables are determined within the Three-Sector-Model while exogenous variables are not. Exogenous variables are therefore treated as shocks to the Three-Sector-Model. e. Exogenous variables are determined within the Three-Sector-Model while endogenous variables are not. Endogenous variables are therefore treated as shocks to the three markets.
A price floor will be binding only if it is set
a. equal to the equilibrium price. b. above the equilibrium price. c. below the equilibrium price. d. either above or below the equilibrium price.
GDP is the market value of:
A. all intermediate goods and services produced in an economy in a given year. B. all expenditures on consumption, investment, and net exports in an economy in a given year. C. all final goods and services produced in an economy in a given year. D. all expenditures on natural resources, labor, and capital goods in an economy in a given year.