Suppose a perfectly competitive firm is producing 1,000 units of output and the marginal cost of the 1,000th unit is $7. If the firm can sell each unit of output for $7 and the firm's revenue is sufficient to cover its variable cost, the firm should:
A. leave production unchanged.
B. decrease production to lower losses.
C. increase price to increase profits.
D. increase production to increase profits.
Answer: A
You might also like to view...
The German central bank gained international reserves in the early 1970s because it sold ________ to prevent mark ________
A) marks; appreciation B) dollars; appreciation C) marks; depreciation D) dollars; depreciation
Which of the following is true when the government attempts to move the economy to full employment by increasing spending?
A. The desired stimulus should be set by the multiplier divided by the AD shortfall. B. The total change in spending includes both the new government spending and the subsequent increases in consumer spending. C. It must initially spend more than the GDP gap if the aggregate supply curve is upward-sloping. D. The desired stimulus should be set by the AD shortfall multiplied by the multiplier.
What is defined as an entity which makes product, good or services available to buyer or consumer in exchange of monetary consideration?
A. Seller B. Manufacturer C. Producer D. Buyer or consumer
The strengths of the British National Health Service (NHS) include:
a. the fact that there is a surplus of clinicians, so there is little need for foreign-trained physicians and nurses to practice in Britain. b. the fact that no one has the ability to jump to the top of the slow-moving waiting list for medical treatment. c. the fact that patients have access to all medically necessary care regardless of cost. d. good access to primary and preventive care. e. the fact that there are no differences in access to medical care based on socioeconomic status or geographic location.