Author Question: The above figure illustrates a firm's total revenue and total cost curves. Which one of the ... (Read 137 times)

piesebel · **on:** Jun 29, 2018

The above figure illustrates a firm's total revenue and total cost curves. Which one of the following statements is FALSE?

A) Economic profit is the vertical distance between the total revenue curve and the total cost curve.
B) At output Q1 the firm makes zero economic profit.
C) At an output above Q3 the firm incurs an economic loss.
D) At output Q2 the firm incurs an economic loss.

Question 2

In the above figure, if aggregate demand does not change, the long-run equilibrium will be at the price level of ________ and real GDP of ________.

A) 100; 15.5 trillion
B) 120; 16 trillion
C) 100; 16 trillion
D) 110; 15.5 trillion