Suppose product price is $24; MR = MC at Q = 200; AFC = $6; AVC = $16 . What do you advise this competitive price-taker firm to do?
a. Increase output.
b. Decrease output.
c. Shut down operations.
d. Stay at the current output; the firm is earning a profit of $400.
e. Stay at the current output even though the firm is losing $200.
A
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The payment of unemployment compensation tends to induce business firms to
A) lay off workers as opposed to lowering sales. B) search for new workers for shorter periods of time. C) lay off workers as opposed to increasing inventories and/or reducing hours worked for all employees. D) recall previously laid off workers more rapidly.
For price discrimination to exist, all of the following are necessary EXCEPT
A) a downward sloping demand curve. B) an identifiable group of buyers with different elasticities of demand. C) an upward sloping marginal cost curve. D) there can be no resale of the product.
Which of the following sayings describes the concept of diminishing marginal utility?
a. time is money b. penny wise and pound foolish c. absence makes the heart grow fonder d. a penny saved is a penny earned e. a fool and his money are soon parted
The World Bank was created to help finance economic development in poor countries
a. True b. False Indicate whether the statement is true or false