Suppose that a monopolistically competitive firm is in long-run equilibrium. The firm's demand curve is tangent to its average cost curve at Q = 25 . Average cost is minimized at Q = 35, where average cost is $50 . Which of the following is true?
a. This firm maximizes profit at an output level of 25 units.
b. This firm maximizes profit at an output level of 35 units.
c. This firm maximizes profit at an output level less than 25 units.
d. This firm maximizes profit at an output level greater than 35 units.
e. There is not enough information to find the firm's profit-maximizing level of output.
A
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Open market purchase will result in:
A) increase in bank reserves and a decrease in the federal funds rate. B) increase in bank reserves and an increase in the federal funds rate. C) decrease in bank reserves and a decrease in the federal funds rate. D) decrease in bank reserves and an increase in the federal funds rate.
In the long run, each firm in a competitive industry earns
a. zero accounting profits. b. zero economic profits. c. positive economic profits. d. Both a and b are correct.
Which of the following is the best example of capital?
A. a family buying a newly produced home B. a shoe store adding to its inventories C. a ship used to carry oil across the ocean D. the production and sale of a new delivery van for UPS
One of the two reasons why we are driven to buy and sell goods and services in the market is that most of us are incapable of producing everything we want to consume.
Answer the following statement true (T) or false (F)