If a monopolist's marginal revenue is $35 per unit and its marginal cost is $25, then
A) to maximize profit the firm should decrease output.
B) to maximize profit the firm should continue to produce the output it is producing.
C) to maximize profit the firm should increase output.
D) Not enough information is given to say what the firm should do to maximize profit.
C
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What is the national security argument to support protection from international trade?
A) Domestic firms must be protected until they gain a comparative advantage. B) Any firm necessary in wartime must be protected. C) Foreign producers selling below cost to drive domestic firms bankrupt must be stopped. D) Domestic jobs must be protected from competition from low-paid foreign workers. E) Foreigners selling products in the economy limit the nation's diversity and stability.
Pricing insurance policies is made difficult because buyers have more information than sellers. This difficulty is an example of
A) adverse selection. B) asymmetric information. C) the free-rider problem. D) moral hazard.
Bank C receives a deposit of $40,000 . If the required reserve ratio in the economy is equal to 25 percent, the final change in demand deposits of Bank C will be equal to:
a. $160,000. b. $200,000. c. $100,000. d. $150,000.
If the exchange rate between the U.S. dollar and Japanese yen changes from $1 = 100 yen to $1 = 90 yen, then
A. Japanese tourists visiting the United States will benefit. B. U.S. auto producers and autoworkers will lose. C. All Japanese producers and consumers will lose. D. U.S. consumers of Japanese TV sets will benefit.