Suppose that each worker must use only one shovel to dig a trench, and shovels are useless by themselves. In the long run, the firm's cost function is
A) TC = (w/r) ? q.
B) TC = (w + r)/q.
C) TC = (w + r).
D) TC = (w + r) ? q.
D
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Which of the following statements regarding the long run for a profit-maximizing monopolistically competitive firm is FALSE?
A) The firm is making zero economic profit. B) The firm produces the quantity of output for which marginal revenue equals marginal cost. C) The average total cost equals the price. D) The firm produces the quantity at which the marginal revenue curve intersects the demand curve.
Dissaving occurs when
A. the amount of consumption exceeds the amount of saving. B. people save smaller and smaller amounts. C. consumption spending exceeds disposable income. D. saving exceeds consumption.
The aggregate consumption function is C = 800 + 0.8Yd. If income is $2,000 and net taxes are $500, consumption equals
A. 1,500. B. 2,000. C. 2,050. D. 2,150.
Consider a commonly owned fishery in a market with no other fisheries. Given the Tragedy of the Commons, it is more efficient to let a single firm take over the fishery even if that gives the firm monopoly power.
Answer the following statement true (T) or false (F)