Answer the following statement(s) true (T) or false (F)
1. If a firms fixed costs increase from $2,000 to $3,000, then its marginal cost is $1,000.
2. If a firm can sell one more unit of its product for $7 and the marginal cost of producing that one more unit is only $5, then it should definitely produce and sell one more unit.
1. False
2. False
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Suppose a firm in a competitive market reduces its output by 20 percent. As a result, the price of its output is likely to
a. increase. b. remain unchanged. c. decrease by less than 20 percent. d. decrease by more than 20 percent.
If in a closed economy Y = $11 trillion, which of the following combinations would be consistent with national saving of $3 trillion?
a. C = $8 trillion, G = $3 trillion b. C = $13 trillion, G = -$1 trillion c. C = $9 trillion, G = $5 trillion d. C = $7 trillion, G = $1 trillion