Internal markets
A) are used to determine a transfer price.
B) are common in corporate America.
C) are part of a firm's vertical network.
D) all of these choices.
A
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Suppose that a perfectly competitive firm's marginal revenue equals $12 when it sells 10 units of output. If the marginal cost of producing the 10th unit is $14, to maximize its profit the firm should
A) do nothing because it is already maximizing its profit. B) decrease its production. C) increase its production. D) shut down. E) increase the price it charges for its product.
Resource owners will supply additional units of a resource as long as
a. doing so increases their costs b. doing so increases production c. the quantity of the resource demanded exceeds the resource price d. resource users demand the resource e. doing so increases their utility