Author Question: Consider a firm operating with the following: price = 10; MR = 10; MC = 10; ATC = 10 . This firm is: ... (Read 73 times)

CQXA · **on:** Jun 30, 2018

Consider a firm operating with the following: price = 10; MR = 10; MC = 10; ATC = 10 . This firm is:
a. making an economic profit of 10.
b. an example of monopolistic competition.
c. going to go out of business in the long run.
d. a monopolist for a product with a relatively inelastic demand.
e. perfectly competitive in long-run equilibrium.

Question 2

Applying supply and demand analysis, other factors held constant, the steeper the supply curve (more inelastic), the larger the burden of a sales tax that is borne by the sellers.
a. True
b. False
Indicate whether the statement is true or false