The measurements of business cycles tend to be exaggerated as a result of the GDP treatment of
a. services.
b. perishable goods.
c. government services.
d. durable goods.
d. durable goods.
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At equilibrium in a market for a product, the total revenues received by sellers equal the
A. market producer surplus. B. total amount spent by buyers on the product. C. market consumer surplus. D. total profit of sellers.
Which of the following is likely to happen if there is an increase in entrepreneurial activity in an economy?
A) The productivity of the economy will increase. B) The inflation rate in the economy will decrease. C) The exchange value of its currency in the foreign exchange market will increase. D) The income per capita of the economy will fall.
Java Joe sells 200 cups of coffee each day in a perfectly competitive market at the market price of $2.00 per cup. If Java Joe independently decreased its price per cup to $1.50,
a. its sales would rise to 250 cups b. its revenue would decrease c. its revenue would rise d. its total revenue would equal $200 e. the market price will fall to $0.75 as other coffee sellers match the price cut
In the short run, a monopolistically competitive firm
A. May make economic profits, but it fails to make economic profits in the long run because of the entry of new firms. B. May make profits just as it does in the long run because firms can enter easily. C. Makes profits just as it does in the long run because entry is blocked. D. Produces at a rate at which long-run average cost equals price, but not at which long-run marginal cost equals marginal revenue.