According to the above figure, if the firm is earning zero economic profits, what quantity is the firm selling and at what price?
A. Q = 1,200; P = $7
B. Q = 1,000; P = $5
C. Q = 800; P = $4
D. Q = 200; P = $4
Answer: B
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In a business cycle, a period from peak to trough may be referred to as ________
A) an expansion B) a recurrence C) a contraction D) all of the above E) none of the above
Karl can produce either 10 tons of oranges or 5 tons of apples in a year, while Adam can produce either 5 tons of oranges or 10 tons of apples. Which of the following is true? a. Mutually beneficial trade between Karl and Adam could take place at an exchange rate of 1 ton of apples to 1 1/2 ton of oranges. b. Mutually beneficial trade between Karl and Adam could take place at an exchange rate
of 1 ton of oranges to 1 1/2 ton of apples. c. both a. and b. are true. d. neither a. nor b. are true.
The investment when a firm runs part of its operation abroad or invests in another company abroad is called:
A. import investment. B. export investment. C. foreign direct investment. D. portfolio investment.
According to the interest-rate-based transmission mechanism for monetary policy, an increase in the money supply will cause the
A. interest rate to rise, causing planned real investment spending to rise and leading to a decrease in aggregate demand. B. interest rate to fall, causing planned real investment spending to fall and leading to an increase in aggregate demand. C. interest rate to fall, causing planned real investment spending to rise and leading to a decrease in aggregate demand. D. interest rate to fall, causing planned real investment spending to rise and leading to an increase in aggregate demand.