When a perfectly competitive market has fully adjusted to demand and supply conditions, all of the following are true except:
A) P = MC.
B) P = the minimum of SRATC.
C) P = the minimum of LRAC.
D) P = the minimum of AVC.
D
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Cindy's Sweaters' production function is shown in the above table. Cindy rents two knitting machines for $30 a day each and hires workers at a wage rate of $40 a day. If Cindy produces 18 sweaters per day, what is her total cost?
A) $120 B) $140 C) $180 D) $60
For open economies,
A) S = I. B) S = I + CA. C) S = I - CA. D) S > I + CA. E) S < I + CA.
The price elasticity of demand for a good measures the willingness of
a. consumers to buy less of the good as price rises. b. consumers to avoid monopolistic markets in favor of competitive markets. c. firms to produce more of a good as price rises. d. firms to respond to the tastes of consumers.
The following graph shows the production possibilities curve for the economy with only two members, Silvia and Art. Silvia can produce either 50 pounds of beef or 2 computers per week, and Art can produce 100 pounds of beef or 1 computer per week. Both of them work 40 weeks per year.
Silvia has a comparative advantage in producing ________, and Art has a comparative advantage in producing ________.
A. beef; beef B. computers; computers C. computers; beef D. beef; computers