The long-run total cost of zero output is equal to
A. the marginal revenue product of labor.
B. fixed cost.
C. variable cost.
D. zero.
Answer: D
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Assume that because of a long policy lag, the Fed starts implementing expansionary monetary policy too late, i.e., at a time when the economy is already healing itself. As a result, the economy will probably move from an initial
A) recessionary gap to an even deeper recessionary gap. B) recessionary gap to an inflationary gap. C) inflationary gap to the natural level of Real GDP. D) inflationary gap to a recessionary gap.
Which of the following is the government's primary means of financing deficit spending?
In the long run, profits in a monopolistic competition market are zero because:
a. of government regulations. b. of collusion. c. firms are free to enter and exit the market. d. firms produce a differentiated product.
The plusses and minuses of the patent system include the following, except:
A. It could give inventors an incentive to bear the research and development costs of new products B. It could allow stodgy old firms to survive longer than they should against innovative rivals C. It would prevent the existence of "patent trolls" or firms whose main purpose is to sue companies D. It may hinder creative destruction especially in complex products that encompass several patents