Hanak Products, a perfectly competitive firm, is experiencing profitability. Given this information, what will Hanak Products do?
a. In the short run, the firm will improve product quality.
b. In the long run, the firm will create quality controls.
c. In the short run, the firm will reduce its staff size.
d. In the long run, the firm will increase production.
d. In the long run, the firm will increase production.
In the long run, the firm will increase production.
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According to classical theory, any changes in aggregate demand will
A) have no affect on prices or real Gross Domestic Product (GDP). B) lead to changes in both real Gross Domestic Product (GDP) and the price level. C) lead to changes in the price level. D) lead to changes in real Gross Domestic Product (GDP), but not in the price level.
In the above figure, suppose the economy had been at point A and now is at B. What could have led to the movement to B?
A) a tax hike B) an increase in government expenditures on goods and services C) Winter storms cause factories in the north to be shut down for several weeks. D) an increase in the money wage rates
You can borrow $5000 to finance a new business venture. This new venture will generate annual earnings of $251. The maximum interest rate that you would pay on the borrowed funds and still increase your income is
A) 25%. B) 12.5%. C) 10%. D) 5%.
A simultaneous increase in both unemployment and inflation is most likely to be the result of a(n):
a. increase in long-run aggregate supply. b. increase in short-run aggregate supply. c. decrease in the aggregate demand. d. simultaneous outward shift of the aggregate demand and supply curves. e. decrease in the short-run aggregate supply.