A purely competitive firm:
A. must earn a normal profit in the short run.
B. cannot earn economic profit in the long run.
C. may realize either economic profit or losses in the long run.
D. cannot earn economic profit in the short run.
Answer: B
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If the marginal cost of an activity exceeds the marginal benefit, then
A) the activity will occur because the high marginal cost means it must be highly valued. B) the forgone alternatives' costs must be increased. C) an alternative action will be selected. D) the person must concentrate on the activity's total benefits.
Recent estimates put the size of the underground economy in the United States at ________ of measured GDP
A) 2 percent B) 8 percent C) 13 percent D) over 50 percent
With full information any contract will lead to production efficiency
Indicate whether the statement is true or false
Suppose the Tooth Fairy paid 50 cents for a tooth in 1970 . The CPI in 1970 was 38.8, while the CPI in 2010 was 218.1 . What is the value of the Tooth Fairy's payment in 2010 dollars?