For a perfectly competitive firm, the short-run break-even point occurs at the level of output where

An economist who would most likely use active policy making would support which of the following conclusions?

A) Demand shocks have little or no short-run effects on real Gross Domestic Product (GDP) and unemployment. B) Pure competition is not typical in most markets. C) Price flexibility is common in most markets. D) Supply shocks explain most business cycles.

In the constant-growth dividend valuation model, the required rate of return on common stock (i.e., cost of equity capital) can be shown to be equal to the sum of the dividend yield plus the ____

a. yield-to-maturity b. present value yield c. risk-free rate d. dividend growth rate e. none of the above