Use the following graph showing the average total cost curve for a perfectly competitive firm to answer the next question.
At the long-run equilibrium level of output, this firm's total cost
A. is $10.
B. is $400.
C. is $40.
D. cannot be determined from the information provided.
Answer: B
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Consumers are often somewhat insensitive to changes in the price of table salt because
A) the proportion of their budget spent on salt is very low. B) there are a considerable number of good substitutes for salt, in their opinion. C) they are not used to changes in the price of salt. D) salt is a necessity for a complete dining experience. E) all of the above reasons.
What is the relationship between actual and potential real GDP?
What will be an ideal response?
With velocity constant, an increase in the money supply multiplied by velocity yields the increase in equilibrium
A) interest rates. B) money demand. C) price level. D) income.
Savings are good for a family. If all families increase savings, the economy is better off. This fallacy of composition is called:
a. the paradox of time. b. the paradox of dissaving. c. the paradox of thrift. d. the paradox of value. e. the paradox of choice.