Suppose that for a monopolist, MR = MC = $10 and P = $15 at the profit-maximizing level of output. At this level of output, the firm
a. is earning a profit
b. will shut down if AVC > $15
c. is making $5 profit on each unit sold
d. will shut down if ATC > $15
e. is losing $5 per unit produced
B
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In the United States, which agency determines whether domestic firms have been harmed by subsidies and dumping or by a sudden surge in imports and whether protection is warranted?
What will be an ideal response?
Firms that make game systems like Playstation and Nintendo typically charge a price close to average cost on the game system itself, and do not change that price even when the systems are scarce or demand increases
Why might this be a profit-maximizing strategy?
Assume that the central bank lowers the discount to increase the nation's monetary base. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the quantity of real loanable funds per time period and the nominal value of the domestic currency in the context of the Three-Sector-Model? State your answer after the macroeconomic system returns
to complete equilibrium. a. The quantity of real loanable funds per time period rises and nominal value of the domestic currency remains the same. b. The quantity of real loanable funds per time period falls and nominal value of the domestic currency remains the same. c. The quantity of real loanable funds per time period and nominal value of the domestic currency remain the same. d. The quantity of real loanable funds per time period rises and nominal value of the domestic currency rises. e. There is not enough information to determine what happens to these two macroeconomic variables.
A situation in which output decreases while prices increase is often referred to as:
A. inflation. B. negative economic growth. C. a recession. D. stagflation.