A perfectly competitive firm will not operate where MC = MR but at MC = AC.

Refer to Figure 15-9. In the figure above suppose the economy is initially at point A. The movement of the economy to point B as shown in the graph illustrates the effect of which of the following policy actions by the Federal Reserve?

A) an increase in the required reserve ratio B) a decrease in income taxes C) an open market sale of Treasury bills D) an open market purchase of Treasury bills

Shellee heads up a company that has a monopoly on a solar battery technology due to a patent. Shellee wants to raise the price by 50% to increase revenue by 50%. What is she forgetting?

a. When monopolists raises prices, they are breaking the law. b. When monopolists raise prices, demand falls. c. Monopolists cannot change revenue by changing prices. d. Monopolists do not get to price their own products.