A competitive firm should always continue to operate in the short run as long as
A. P < ATC.
B. MR > MC.
C. MR > AVC.
D. P < AVC.
Answer: C
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Short-run decisions refer to the:
A. hourly, daily, or weekly decisions that firms have to make. B. decisions a firm has to make immediately to prepare for either entering or exiting an industry. C. immediate decisions that firms have to make that affect level of output, but not the production process. D. immediate decisions that firms have to make that affect the production process, not level of output.
When the price of corn was "low," consumers in the United States spent a total of $8 billion annually on its consumption. When the price halved, consumer expenditures actually DECREASED to $6 billion annually. This indicates that:
A. the demand for corn is elastic. B. the demand for corn is inelastic. C. corn is a Giffen good. D. the demand curve for corn is upward sloping.
If GDP grew 3% in 1970, 2.2% in 1971 and 2.5% in 1972 then, what is the average annual growth rate over this period?
A) 5% B) 4% C) 2.6% D) -2.2%
In practice, many U.S. import prices tend to rise by only around
A) 1/4 of a typical dollar depreciation over the following year. B) 1/3 of a typical dollar depreciation over the following year. C) 1/2 of a typical dollar depreciation over the following year. D) 2/3 of a typical dollar depreciation over the following year. E) 2/5 of a typical dollar depreciation over the following year.