If the market price ever drops below a firm's average variable costs at its profit-maximizing level of output the:
A. firm should shut down immediately.
B. loss-minimizing quantity of output is zero.
C. firm is not earning enough revenue to cover the variable costs of production.
D. All of these are true.
D. All of these are true.
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At a given price level, anything that changes the amount of total purchases in the economy will cause the aggregate demand curve to shift
a. True b. False Indicate whether the statement is true or false
When the price is $2
A. quantity supplied is greater than quantity demanded and, therefore, price must rise to get to equilibrium.
B. quantity supplied is less than quantity demanded and, therefore, price must fall to get to equilibrium.
C. quantity demanded is greater than quantity supplied and, therefore, price must rise to get to equilibrium.
D. quantity demanded is greater than quantity supplied and, therefore, price must fall to get to equilibrium.