Sweet Husks is a perfectly competitive corn farm. Currently, the expected price of an ear of corn is $0.30 and, at its current production level, Sweet Husks has a marginal cost of $.40 per ear. Which of the following statements is true?
A) Because the expected profit from an additional ear of corn is $0.10, Sweet Husks should decrease production to maximize its expected profit.
B) Because the expected profit from an additional ear of corn is -$0.10, Sweet Husks should decrease production to maximize its expected profit.
C) Because the expected profit from an additional ear of corn is $0.70, Sweet Husks should increase production to maximize its expected profit.
D) Because the expected profit from an additional ear of corn is $0.10, Sweet Husks should increase production to maximize its expected profit.
B) Because the expected profit from an additional ear of corn is -$0.10, Sweet Husks should decrease production to maximize its expected profit.
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Proponents of a command economy argue that it promotes:
a. efficiency. b. equity. c. consumer sovereignty. d. economic growth.
Which of the following is not one of the fundamental economic questions all societies must face? a. What goods and services are to be produced?
b. How goods and services are to be produced? c. Which goods and services are to be produced by the government? d. Who is to receive the goods and services produced in the society?
One of the primary functions of markets could be labeled
a. stimulation. b. coordination. c. planification. d. decentralization.
A permanent reduction in inflation would
a. permanently reduce the frequency of price changes and permanently lower unemployment. b. permanently reduce the frequency of price changes and temporarily raise unemployment. c. temporarily reduce the frequency of price changes and temporarily lower unemployment. d. temporarily reduce the frequency of price changes and temporarily raise unemployment.