Suppose the equilibrium price in a competitive price-taker market is $10 and a firm in the industry charges $9 . Which of the following is true?
a. The firm will not be able to sell any output.
b. The firm will sell less output than its competitors.
c. The firm will make more profit than it could at the $10 price.
d. The firm will make less profit than it could at the $10 price.
D
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Representative commodity money retained its value because
A) it was an actual commodity. B) it was a fiat money. C) it was backed by the government. D) it could be exchanged for an actual commodity.
The idea that individuals should be taxed in proportion to the marginal benefits that they receive from public goods is called
A) the horizontal-equity principle. B) the ability-to-pay principle. C) the benefits-received principle. D) the vertical-equity principle.
The above figure shows the reaction functions for two pizza shops in a small isolated town. The Cournot equilibrium is at point
A) a. B) b. C) c. D) d.
Which of the following statements is false?
a. In a competitive market, the price mechanism encourages conservation of a depletable resource. b. As the price of a depletable resource rises, its known reserves often increase. c. Prices of depletable resources have risen in the twentieth century primarily because resource producers have exercised monopoly or oligopoly power. d. Shortages of depletable resources occur primarily when governments or others interfere with the price mechanism.