A firm with no competition faces a perfectly inelastic demand curve.
a. true
b. false
Answer: b. false
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At the beginning of 1960 the CPI was 29.6. At the beginning of 2000 it was approximately 170.8. Which of the following most closely approximates the forty-year rate of inflation?
A. 141 percent B. 282 percent C. 350 percent D. 477 percent E. 550 percent
A monopolist can maximize profits by:
A. following the same rules as a perfectly competitive firm. B. producing at the level of output at which MR = 0. C. selling an output where P = ATC. D. selling as much as he can produce.
Suppose that Country A has an absolute advantage over Country B in the production of both wheat and cloth. The opportunity cost of 1 unit of wheat is 2 units of cloth in Country A and 3 units of cloth in Country B. It follows that
a. Country A has a comparative advantage in both wheat and cloth. b. Country A has a comparative advantage in wheat. c. Country B has a comparative advantage in wheat. d. Country A has a comparative advantage in cloth.
A business owner makes 50 items a day. He spends 8 hours in producing those items. If hired elsewhere he could have earned $10 an hour. The item sells for $10 each. Production occurs seven days a week. If the explicit costs total $10,000 a month, the accounting profit for the month equals:
a. $1,760 b. $2,240 c. $11,760 d. $5,000