The Whatsa Widget Company produces widgets in a perfectly competitive market. The price of a widget is $9 . Whatsa is currently producing at a rate where the marginal cost of production is $15
Is this company maximizing profit at its current level of output? Explain.
No, the company is not maximizing profit because marginal revenue is not equal to cost. In fact, the cost of the last unit produced ($15) is greater than the revenue that the firm gained from its sale. Thus, the firm lost money on the last unit sold. To maximize profits, the firm needs to lower its level of output.
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The traditional definition of a recession is a decline in real GDP lasting for
A) at least one month.
B) at least two consecutive quarters.
C) at least one year.
The price of services at Urban General falls by 10 percent
a. Quantity demanded at Urban General increases by 15.0 percent. b. Quantity demanded at Urban General increases by 1.5 percent. c. Quantity demanded at St.Elsewhere rises by 3.5 percent. d. Quantity demanded at St.Elsewhere falls by 5.0 percent. e. Quantity demanded at Urban General rises by 5.0 percent.
If firms in a monopolistically competitive market are incurring economic losses, which of the following statements describes the changes that occur as the market adjusts to the long-run equilibrium?
a. Each existing firm's demand curve shifts to the right. b. More firms exit the market. c. Each firm eliminates its excess capacity. d. Both a and b are correct.
The education and skills of workers are factors driving
A. productivity functions. B. economic inflation. C. economic growth. D. inflationary growth.