The table above gives the demand schedule for water bottled by Wanda's Healthy Waters. Wanda's marginal cost is a constant $4 a bottle and has no fixed cost. Wanda's makes an economic profit of ________ a day
A) $0
B) $24
C) $36
D) $60
C
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If the economy is in equilibrium with real GDP less than potential GDP, there is ________ gap, and a fiscal policy that ________ is appropriate
A) a recessionary; decreases aggregate demand B) an inflationary; increases aggregate demand C) a recessionary; increases aggregate demand D) an inflationary; decreases aggregate demand E) a recessionary; increases potential GDP
Whenever the general level of prices rises because of continual increases in aggregate demand, we say that the economy is experiencing
A) supply-side inflation. B) monetary stagflation. C) demand-side inflation. D) aggregate supply shock.
All these are characteristics of a monopoly except,
a. There is one seller of the product b. Has few substitutes c. Controls a large share of the market d. Controls a small share of the market
Which of the following explains why theater prices for popcorn are three or four times higher than the popcorn price in the grocery store?
A. Grocery stores are satisfied with normal profit while theaters seek economic profit. B. The grocery store sells a much higher volume and gets its profits that way. C. The cost of popping the popcorn is high. D. The demand curve for popcorn in a theater is more inelastic than the demand for popcorn at the grocery store.