Under both perfect competition and monopoly, a firm:
a. is a price taker.
b. is a price maker.
c. will shut down in the short-run if price falls short of average total cost.
d. always earns a pure economic profit.
e. sets marginal cost equal to marginal revenue.
e
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When speculators buy gasoline during the low demand spring in order to sell it during the high demand summer, they cause an increase in dead weight loss in the spring that is more than made up for by an increase in social surplus in the summer.
Answer the following statement true (T) or false (F)
The federal funds rate
A) is determined directly by firm demand for funds. B) is determined administratively by the Fed. C) is determined directly by household demand for funds. D) is determined by the supply of and demand for bank reserves.
If you have flipped a fair coin and tails has come up 49 times in a row, what are the odds that the next flip will be a tail?
A) 0 B) 1/50 C) 1/25 D) 1/2
In order to obtain an efficient allocation of resources worldwide
A) countries that have a lot of resources should ship resources to countries that do not have a lot of resources. B) countries that have a lot of resources should not trade since poorer countries cannot compete. C) each country should produce the good they have a comparative advantage in and then trade. D) no trade among countries should occur.