A monopolistically competitive firm is operating at a short-run level of output where price is $21, average total cost is $15, marginal cost is $13, and marginal revenue is $13. In the short run this firm should
A. increase the level of output.
B. decrease the level of output.
C. make no change in the level of output.
D. reduce product price.
Answer: C
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Which of the following statements regarding an average-cost pricing rule for a natural monopoly is WRONG?
A) It sets price equal to average total cost. B) It is efficient. C) The firm makes zero economic profit. D) More output is produced than if the firm maximized profit.
An increase in the nominal wage shifts the aggregate supply inward.
Answer the following statement true (T) or false (F)
University researchers create a positive externality because what they discover in their research labs can easily be learned by others who haven't contributed to the research costs. If there are no subsidies, what is the relationship between the equilibrium quantity of university research and the optimal quantity of university research produced?
a. They are equal. b. The equilibrium quantity is greater than the socially optimal quantity. c. The equilibrium quantity is less than the socially optimal quantity. d. There is not enough information to answer the question.
A bank that has $10,000 in excess reserves can extend new loans up to a maximum of
What will be an ideal response?