An inelastic supply schedule means that suppliers are unable to substitute away from producing a good in response to a tax

The average cost of production at the profit maximizing output level for Jones Inc, is $4 per unit. The average variable cost of production is $3.5 per unit at this output level. The introduction of cheaper substitutes reduces the demand drastically and the market price falls to $1.5 per unit. If the minimum average variable cost the firm must incur is $2.5, identify the correct statement from

the following. a. There are output levels where revenue exceeds variable cost when the price is $1.5 per unit. b. The firm will continue to operate in the short run. c. The firm will breakeven at the price of $1.5 per unit. d. The firm will shut down.

The more substitutable current consumption is with future consumption, the more likely it is that an increase in the interest rate will cause an increase in savings.

Answer the following statement true (T) or false (F)