Assume that as the firms in a perfectly competitive industry expand output, the prices of productive inputs increase
All else constant, this would cause the individual firms' marginal cost curves to ________ and the market supply curve to become ________. A) shift down; flatter
B) shift down; steeper
C) shift up; flatter
D) shift up; steeper
D
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The "law of supply" states that, other things remaining the same, firms produce
A) more of a good the less it costs to produce it. B) less of a good the more it costs to produce it. C) more of a good the higher its price. D) less of a good as the required resources become scarcer.
"As part of the financial crisis bailout plan in 2009, the Federal Reserve bought stakes in banks. This policy will result in an increase in the inflation rate." This is an example of
A) a positive statement. B) a normative statement. C) a microeconomic statement. D) an economic model.
In the above figure, if the interest rate is negatively related to household expenditures for any given level of household income, an increase in the interest rate will
A) shift the line vertically upward. B) shift the line vertically downward. C) make the line negatively sloped. D) cause no change in the line's position.
In the long-run equilibrium, both the perfectly competitive firm and the monopolistically competitive firm produce the output at which MR=MC and charge a price equal to the average total cost of production
Indicate whether the statement is true or false