Refer to the above figure. The firm is currently producing at Q2. The firm should
A. shut down.
B. reduce production.
C. increase production.
D. leave production as it is.
Answer: B
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During a time of high unemployment, a country can increase the production of one good or service
A) by using resources in the production process twice. B) without decreasing the production of something else. C) and must increase the production of something else. D) but must decrease the production of something else. E) but the opportunity cost is infinite.
If the social cost of producing a good exceeds the private cost,
A) a negative externality exists. B) no externalities exist. C) a positive externality exists. D) the market is efficient.
The velocity of money in circulation measures: a. the average length of time that people hold wealth
b. how fast aggregate spending will increase for a given decline in money demand. c. how fast inflation will rise for a given increase in the money supply. d. how quickly money changes hands. e. how quickly banks can create money.
Price leadership may sometimes be an example of covert collusive behavior by oligopolies.
Answer the following statement true (T) or false (F)