To achieve allocative efficiency, firms
a. strive to minimize fixed costs
b. strive to maximize profits
c. produce at their minimum long-run average cost
d. produce at their minimum long-run marginal cost
e. produce the output consumers want most
E
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Since 1970 there has been a clear increase in the proportion of the banking industry assets made up of
A) mortgage loans. B) state and local government securities. C) cash. D) business loans.
There is only one gas station within hundreds of miles. The owner finds that when she charges $3 a gallon, she sells 199 gallons a day, and when she charges $2.99 a gallon, she sells 200 gallons a day. The marginal revenue of the 200th gallon of gas is:
a. $.01. b. $1. c. $2.99. d. $3. e. $600.
Which of the following is one of the main revenue sources for state and local governments?
a. income taxes b. sales taxes c. estate taxes d. excise taxes
The supplier of a factor of production has a reservation price of $100. The purchaser of the factor of production has a reservation price of $200. If the factor of production is unique, then:
A. a transaction will occur, and the price paid for the factor of production will be $200. B. a transaction will occur, and the price paid for the factor of production will be $100. C. a transaction will occur, and the price paid for the factor of production will be $150. D. there will be no transaction since $200 is greater than $100.