If a perfectly competitive firm is producing a rate of output at which MC exceeds price, then the firm
A. Can increase its profit by increasing output.
B. Can increase its profit by decreasing output.
C. Is maximizing profit.
D. Must have an economic loss.
Answer: B
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Which of the following are reasons why Social Security is compulsory?
a. A pay-as-you-go system needs new contributors to maintain solvency. b. A pay-as-you go system cannot let older individuals opt out of benefits. c. The adverse selection problem. d. all of the above e. a and c
Suppose Bob leaves his $50,000-a-year job as a financial advisor to P.E.T.S. and starts his own business selling spot remover for Dalmatians. In the first year his accounting profit is $70,000 . Based on this level of success, Bob should
a. return to his old job because his economic profit is negative b. return to his old job because his economic profit is smaller than his accounting profit c. return to his old job because his economic profit is less than his old salary d. stay with his new firm because his economic profit is positive e. stay with his new firm because accounting profit is positive
In the above figure, to achieve efficiency, the government should
A) impose a tax of $2 per unit. B) impose a tax of $3 per unit. C) offer a subsidy of $2 per unit. D) offer a subsidy of $3 per unit.
Which of the following U.S. Treasury securities represents ownership of the national debt?
a. Bonds owned by the banks and insurance companies. b. Bonds owned by private individuals. c. Bonds owned by foreigners. d. All of these.