An "omitted variable" is
A) a variable that has no impact on other variables in an economic analysis.
B) a variable which is purposely omitted from an economic analysis.
C) a variable that affects other variables and its omission from economic analysis can lead to false conclusions about cause and effect.
D) a variable which is inadvertently omitted from an economic analysis.
C
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Bob's Books is the only bookstore in town. The figure above shows the demand curve for books and Bob's Books' marginal revenue curve and marginal cost curve
Bob's Books maximizes its profit and sets the price of a book equal to ________ and has total annual revenue of ________. A) $40; $40,000 B) $30; $60,000 C) $20, $60,000 D) $10; $40,000
The marginal revenue curve for a perfectly competitive firm
A) is the same as its demand curve. B) is perfectly inelastic. C) is downward-sloping. D) is the same as its marginal cost curve.