If a subsidy is granted to perfectly competitive firms that provide external benefits to society, the firm's marginal cost curve will shift ________ and the industry supply curve will shift to the ________.
A. down; left
B. up; right
C. up; left
D. down; right
Answer: D
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Entrepreneurs directly do all of the following EXCEPT
A) create new ideas about what and how to produce. B) make business decisions. C) face risks that arise from making business decisions. D) decide for whom goods and services are produced.
In a perfectly competitive resource market the labor supply curve facing the single firm is
A) vertical. B) horizontal. C) downward-sloping. D) upward-sloping.
In general, people are willing to pay more than the expected value of insurance because:
A. they are risk-averse. B. most people would have trouble finding enough money to cover their losses. C. it allows them to afford major expenses from catastrophes without going bankrupt. D. All of these statements are true.
Refer to Figure 13-4. What is the area that represents the total fixed cost of production?
A) P1bdP3
B) 0P1aQa
C) P0adP3
D) That information cannot be determined from the graph.