The figure below shows the marginal benefit curves for the two firms in an industry, Firm 1 and Firm 2. Which of the statements below is correct?
A) At $250, the industry-wide marginal benefit from advertising is 4 hours.
B) The industry-wide marginal benefit from 1 hour of advertising is $300.
C) The industry-wide marginal benefit from 1 hour of advertising is $550.
D) None of the above statements is correct.
C) The industry-wide marginal benefit from 1 hour of advertising is $550.
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Using Figure 1 above, if the aggregate demand curve shifts from AD1 to AD2 the result in the short run would be:
A. P1 and Y2. B. P3 and Y1. C. P2 and Y2. D. P2 and Y3.
In the short run, a firm’s economic loss or profit is found by comparing what?
a. Price to marginal cost b. Price to marginal revenue c. Price to average total cost d. Price to quantity demanded
An increase in the price of foreign oil can shift the economy’s aggregate supply curve _____ resulting in inflation.
A. inward B. outward C. along the curve D. None of the above is correct.
Other things being equal, the monopolist will
A. have lower profits than if the industry were perfectly competitive. B. hire more workers than if the industry were perfectly competitive. C. hire the same number of workers as a perfectly competitive industry would. D. hire fewer workers than if the industry were perfectly competitive.