The neighborhood ice cream shop finds that when it charges $3 per ice cream cone, its total revenues are $90,000. It has total variable costs of $30,000 and total fixed costs of $40,000. From this we can infer the:
A. shop sells 10,000 ice cream cones.
B. price is less than average total cost.
C. economic profits are $20,000.
D. shop will be closed in the long run.
Answer: C
You might also like to view...
Which of the following would decrease the unemployment rate?
A) government aid to retrain unemployed workers B) an increase in the efficiency wage C) an increase in the minimum wage D) an increase in labor union membership
One way the government can enhance efficiency through the management of common resources is by:
A. banning the good. B. setting quotas for the good. C. government provision of the good. D. All of these can be effective and efficiency-enhancing solutions.
When income rises, total expenditures remain constant
a. True b. False Indicate whether the statement is true or false
Macroeconomists would be most likely to study which of the following?
A. Average annual earnings of lawyers B. Average annual earnings of all employed workers in the United States C. Average annual earnings of doctors D. Average annual earnings of self-employed workers