In the long run, a profit-maximizing monopolistically competitive firm sells at a price that is:
A. equal to average total cost, but higher than marginal cost.
B. equal to marginal cost and marginal revenue.
C. equal to average total cost, but lower than marginal cost.
D. equal to demand, but higher than average total cost and marginal cost.
A. equal to average total cost, but higher than marginal cost.
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The price level is:
A. a measure of overall prices at a particular point in time. B. the price of a specific good in comparison to the prices of other goods and services. C. the percentage change in a price index such as the CPI. D. the rate of inflation.
In the figure above, the equilibrium market price is $20. The producer surplus equals
A) $20. B) $1,500. C) $3,000. D) 150. E) $4,500.
If the full-employment rate of unemployment is 5 percent, and the economy is experiencing a 7 percent unemployment rate, what is the rate of cyclical unemployment?
a. 7 percent b. 12 percent c. -2 percent d. 5 percent e. 2 percent
Other things constant, which of the following would reduce unemployment and raise inflation?
a. businesses become more optimistic about the future of the economy b. because of high growth abroad, net exports rise c. the government cuts taxes d. All of the above are correct.