In the short run, a perfectly competitive firm can either make a profit or exit the market.
Answer the following statement true (T) or false (F)
False
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Currently, the price of consuming housing is lowered by the fact that home mortgage interest is tax deductible. Suppose the government proposed to eliminate this implicit subsidy of your housing consumption and at the same time lowers taxes on all other goods.
a. With housing consumption on the horizontal axis and all other consumption on the vertical, illustrate you current optimal consumption bundle. b. After looking over the government's proposal, you decide that you don't care one way or another whether the government implements this proposal. On your graph, indicate your new budget constraint and new optimal bundle under the proposal. c. I also look over the proposal and find that my current consumption bundle also lies on the budget constraint I would face under the proposal. Am I also indifferent between the two proposals? What will be an ideal response?
One way that government can encourage the production of goods or services that have external benefits is to subsidize the good or service
Indicate whether the statement is true or false
China is trying to move its banking system from being strictly ________ owned by having them issue shares overseas
A) state B) domestic investor C) depositor D) domestic corporate
When quotas are eliminated, losers include
A. Domestic producers. B. Foreign producers. C. There are no losers when free international trade is established. D. Domestic consumers.