Refer to the above graph. Consider a monopolist in short-run equilibrium. This monopolist:
A. will cease production since its economic profits are negative.
B. earns economic profit equal to area ABED.
C. has total fixed costs equal to area BEFC.
D. has total variable costs equal to area 0CFQ.
Answer: D
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If the price of a hot dog is $2 and the price of a hamburger is $4, then the
A) relative price of a hot dog is 1/2 of a hamburger per hot dog. B) money price of a hot dog is 2 hamburgers per hot dog. C) relative price of a hamburger is 1/2 of a hot dog per hamburger. D) money price of a hamburger is 2 hot dogs per hamburger.
Because we face scarcity, every choice involves
A) money. B) the question "what." C) giving up something for nothing. D) an opportunity cost.
If this pollution occurs, the market equilibrium with no government intervention extracts ________ natural gas than the efficient quantity and ________ a deadweight loss
A) less; does not create B) more; does not create C) less; creates D) more; creates
Which of the following statements about a perfectly competitive market are TRUE?
I. The perfectly competitive industry faces an upward sloping labor supply curve. II. The individual firm in a perfectly competitive industry faces a perfectly elastic labor supply curve. A) I only B) II only C) both I and II D) neither I nor II