Which of the following is true for a purely competitive firm in short-run equilibrium?
A. The firm is making only normal profits
B. The firm's marginal cost is greater than its marginal revenue
C. The firm's marginal revenue is equal to its marginal cost
D. A decrease in output would lead to a rise in profits
C. The firm's marginal revenue is equal to its marginal cost
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The Pre-Existing Condition Insurance Plan is a federally administered part of the Affordable Care Act, and is designed for people with pre-existing medical conditions to obtain insurance. By offering health insurance to all U.S
citizens with pre-existing medical conditions, the Pre-Existing Condition Insurance Plan eliminates ________ for both the insurer and the insured, and eliminates ________ for the issuer of the insurance policy. A) the principal-agent problem; moral hazard B) adverse selection; the principal-agent problem C) asymmetric information; adverse selection D) moral hazard; adverse selection
Consumption spending that is independent of the level of disposable income is known as:
a. marginal consumption. b. transitory consumption. c. permanent consumption. d. relative consumption. e. autonomous consumption.
Which of the following products would most closely fit the competitive price-taker model?
a. stereo systems-there are many reputable brands. b. beer-it has many consumers. c. eggs-there are many producers of this relatively homogeneous product. d. automobiles-there are substantial economies of scale in production.
You own an ice cream store and are concerned that an employee may be giving generous scoops to friends and relatives and smaller scoops to some other customers. This may be reducing sales. In this example, you are the
a. principal and the your employee is the agent. b. agent and the your employee is the principal. c. signaler and the your employee is the screener. d. screener and the owner of the coffee ship is the signaler.