Suppose a monopolist charges a price corresponding to the intersection of the marginal cost and marginal revenue curves. If this price is between its average variable cost and average total cost curves, the firm will:
a. earn an economic profit.
b. stay in operation in the short-run, but shut down in the long run if demand remains the same.
c. shut down.
d. none of these.
Question 2
If a consumer is spending all of his/her income in a manner where MUa / Pa is greater than MUb / Pb, then the consumer:
a. is maximizing his/her utility.
b. should increase his/her purchases of B and decrease the purchases of A.
c. should spend more money on both goods.
d. should spend less money on both goods.
e. should increase the purchases of A and decrease the purchases of B.
A graphical representation of the marginal value theorem.
How to create a price index to calculate inflation for a basket of goods
Marginal Products of Physical and Human Capital
Sine Cosine Intersection
The profit, p(t), made at a fair depends on the price of the ticket, t. The profit is modelled ...
Sonal bought a coat for $198.88, which included 8% PST and 5% GST. What was the selling price ...