A firm should shut down in the short run if the price is less than the:
A) average fixed cost.
B) average total cost.
C) average variable cost.
D) marginal cost.
C
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Which of the following is likely to lead to an increase in the quantity supplied of steel?
A) An expected increase in the demand for steel in the future B) A rise in the market price of steel C) A fall in the wage rate of labor employed in the steel industry D) An increase in the productivity of capital due to technological innovation
The short-run aggregate supply curve is upward sloping because in the short run the
A) money wage rate changes but the price level does not. B) price level changes but the money wage rate does not. C) both the money wage rate and the price level change. D) neither the money wage rate nor the price level can change.
The Fed's monetary target shifted in the late 1980s and 1990s when the
a. Fed's focus shifted from the interest rate to the money supply to counter persistent high inflation b. Fed used its discretion to make the money supply conform to a targeted interest rate c. Fed realized that higher interest rates could not stimulate investment, aggregate demand, and real GDP d. Fed became less concerned about inflation and worried more about recession e. Fed abandoned its no-new-taxes pledge
If interest rates fall, the M2 money multiplier:
a. Does not change. b. Rises because C/D and U/D rise, and N/D falls. c. Falls because C/D and U/D fall, and N/D falls. d. Falls because C/D, U/D, and N/D rise. e. Falls because C/D and U/D rise, and N/D falls.