Which of the following is NOT correct concerning perfectly competitive firms in the long run?
A) Long-run economic profits are zero.
B) Price equals minimum long-run average cost.
C) Entrepreneurs earn the opportunity cost of their investment.
D) The opportunity cost of capital is zero.
Answer: D
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Proprietors' income is a component of which approach to measuring GDP?
A) incomes approach B) expenditure approach C) cost approach D) output approach
List three reasons why nominal wages can be sticky in the short run
What will be an ideal response?
The figure below shows a firm that has two plants. Plant 1 has a marginal cost curve of mc1, plant 2 has a marginal cost curve of mc2, and the overall marginal cost curve is MC. Managers maximize their profit by producing ________ units at plant 1 and ________ units at plant 2.
A) 2 million; 4 million
B) 0; 5 million
C) 4 million; 5 million
D) None of the above answers is correct.
If a firm is a price taker, then the demand curve it faces is perfectly
a. elastic and above its marginal revenue curve b. elastic and lies on top of its marginal revenue curve c. elastic and below its marginal revenue curve d. inelastic and above its marginal revenue curve e. inelastic and the same as its marginal revenue curve