The motive that drives firms to enter or exit an industry is
A) opportunity costs.
B) diseconomies of scale.
C) economic profit.
D) accounting costs.
Answer: C
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"When OPEC increases the supply of oil to the market, the price of gasoline falls." This is an example of
A) a normative statement. B) the failure of opportunity cost to determine prices. C) a positive statement. D) a macroeconomic statement.
Refer to the production function. The marginal product at 5 units equals ________ units
Fill in the blank(s) with correct word
The perfectly competitive firm maximizes profits when
A) it produces and sells the quantity at which the difference between marginal revenue and marginal cost is the greatest. B) it produces and sells the quantity at which marginal revenue and marginal cost are equal. C) it produces and sells the quantity at which the difference between average revenue and average cost is the greatest. D) it produces and sells the quantity at which the difference between price and average cost is the greatest.
Income inequality is
A. Not an issue in the United States because of the progressive federal tax system. B. Often greatest in the poorest countries such as Namibia and Botswana. C. A global issue because the poorest tenth of the population gets 20-30 percent of total income. D. Not an issue for wealthy countries such as the United States and Germany.