Author Question: A firm has excess capacity if its output is A) less than the quantity at which marginal cost is ... (Read 55 times)

faduma · **on:** Jun 29, 2018

A firm has excess capacity if its output is

A) less than the quantity at which marginal cost is minimized.
B) less than the quantity at which economic profit is maximized.
C) less than the quantity at which average total cost is minimized.
D) more than the quantity at which average total cost is minimized.

Question 2

The figure above shows the labor demand and labor supply curves for workers in local fast-food restaurants. The fast-food restaurant industry is competitive. A decrease in the supply of labor shifts the labor supply curve from LS0 to LS1.

Fast-food restaurants hire ________ and total labor income earned by the fast-food workers ________. A) 40 hours of labor a day; increases
B) 30 hours of labor a day; decreases
C) 40 hours of labor a day; decreases
D) 30 hours of labor a day; increases