Which of the following conditions is TRUE for a profit-maximizing firm in a perfectly competitive industry?
A) MR = TC
B) ATC = AFC
C) MR = MC
D) MC = AVC
Answer: C
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Refer to Figure 10.1. The minimum feasible price is ________
A) P1 B) P2 C) P3 D) P4 E) none of the above
What is the economic criterion most often used to compare living standards across countries?
a. Real GDP growth. b. Unemployment rate. c. Incidence of AIDS. d. Rate of population growth. e. Real per capita GDP.
When a second firm enters a monopolist's market,
A. the market price will rise. B. the quantity produced by the first firm will decrease. C. the first firm's profits increase. D. All of these will occur.
The forces of supply and demand will provide a quantity that is:
A. less than the efficient quantity if a good generates external benefits. B. more than the efficient quantity if a good generates external benefits. C. exactly the efficient quantity if a good generates external benefits. D. either more than or less than the efficient quantity if a good generates external benefits. It is impossible to know whether it will be too much or too little without more information.