Inventory levels unexpectedly fall and as a result firms increase the quantity of goods and services they produce. Which of the following is consistent with these two occurrences?
A) TP is greater than TE.
B) TP is less than TE.
C) TE is equal to TP minus the rise in inventories above the optimum inventory level.
D) TP is equal to TE.
E) b and c
B
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Since most banks have positive gaps and negative duration gaps, an increase in market interest rates will
A) increase bank profits and increase bank capital. B) increase bank profits and decrease bank capital. C) decrease bank profits and increase bank capital. D) decrease bank profits and decrease bank capital.
Bartech, Inc. is a firm operating in a competitive market. The manager of Bartech forecasts product price to be $28 in 2015. Bartech's average variable cost function is estimated to beAVC = 10 ? 0.003Q + 0.0000005Q2Bartech expects to face fixed costs of $12,000 in 2015. The profit-maximizing (or loss-minimizing) output for Bartech is
A. 2,000 units B. 6,000 units C. 0 units D. 1,000 units E. 500 units