Which statement is true of the market supply curve?
A. It is the horizontal summation of the upward sloping portion of the AVC function of all firms in the industry.
B. One must know the marginal cost information of firms in order to construct a supply function.
C. It is the vertical summation of all the individual supply curves.
D. In perfect competition the slope of the curve is horizontal.
Answer: B
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One difference between perfectly competitive markets and single-price monopoly markets is that
A) marginal revenue equals marginal cost for perfectly competitive firms, but not for monopolists. B) marginal revenue equals price for perfectly competitive firms, but not for single-price monopolists. C) marginal cost equals average variable cost for perfectly competitive firms but not for monopolists. D) All the above answers are correct.
After legislation is signed into law, the time it takes before actual fiscal stimulus is noticed is termed as: a. signal lag
b. implementation lag. c. impact lag. d. recognition lag.
Use the table below to answer the following question.UnitsMaximum Willingness to PayMarket PriceMinimum Acceptable Price1$14$8$2212843108648885681064814What is the value of economic surplus in the table above?
A. $8 B. $24 C. $12 D. $0
Mary Jane is willing to babysit for $6 an hour. Her neighbor has asked her to babysit for $8 an hour. Assuming Mary Jane accepts the offer:
A. her economic rent will be $2 per hour. B. her consumer surplus will be $2 per hour. C. her accounting profit will be $8 per hour, and her economic profit will be $0 per hour. D. her economic profit will be $8 per hour.