A monopolistically competitive firm shuts down in the short run if ________
A) marginal revenue equals marginal cost
B) total revenues do not cover variable costs
C) marginal revenue covers average fixed costs
D) average total cost exceeds price
B
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The two key objectives of the Fed are:
A) low and predictable levels of inflation, and interest rates above 10%. B) zero inflation, and zero unemployment. C) low and predictable levels of inflation, and maximum levels of employment. D) low and predictable levels of inflation, and zero unemployment.
Refer to the figure above, which shows domestic supply and demand. If P1 is equal to P2 (the world price) plus a tariff, then the social loss from the tariff is equal to
A) a + c B) b C) P1 ( Q3 - Q2 ) D) P2 [(Q2 - Q1 ) + (Q4 - Q3 )] E) a + b + c
In many less-developed countries, per capita GDP falls even though real GDP rises, because:
a. output grows at a slower rate than the population. b. the GDP measures in developing countries are always inaccurate. c. consumption spending exceeds investment spending. d. these countries face an acute trade deficit. e. prices increase faster than an increase in actual output level.
Refer to the graphs shown, which depict a perfectly competitive market and firm. If market demand decreases from D0 to D1:
A. market price remains at P0 because perfectly competitive firms can't earn positive economic profit. B. the firm's output remains at q1 because perfectly competitive firms can't earn positive economic profit. C. market price falls from P0 to P1 and the firm's output rises from q0 to q1. D. market price falls from P0 to P1 and the firm's output falls from q1 to q0.