In the fooling model, suppose that from an initial AD/SAS/LAS equilibrium a sudden expansion of aggregate demand occurs. With fooling, we would find employment and the actual real wage in the labor market diagram by moving

At the optimum combination of two inputs,

A) the slopes of the isoquant and isocost curves are equal. B) costs are minimized for the production of a given output. C) the marginal rate of technical substitution equals the ratio of input prices. D) all of the above E) A and C only

In the text, when the Nick Rudd Ice Company starts as a monopoly and then finally faces competition from a new entering ice company, its

a. price falls, its economic profit falls, but its output increases b. price falls, its economic profit falls, and its ATC falls c. price falls, its economic profit falls, and it faces a more elastic demand curve d. price increases, its economic profit falls, and it faces a less elastic demand curve e. ATC falls, its economic profit falls, and it faces a less elastic demand curve