Refer to the scenario above. The average total cost of Firm A when it produces 100 pens is $3, and the average total cost of Firm B when it produces 50 pens is $7. At these levels of production, which of the following statements is true?
A) Both firms incur losses.
B) Firm A incurs a loss but Firm B makes a profit.
C) Firm B incurs a loss but Firm A makes a profit.
D) Both firms make profits.
C
Economics
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If a firm in a competitive market decreases the quantity of output sold, total revenue should
a. decrease. b. increase. c. should change proportionately to the change in total costs for the firm. d. remain the same.
Economics
Purchasing power parity does NOT provide accurate predictions of exchange rates because
A) almost all goods and services are traded across nations. B) governments currently fix exchange rates. C) firms are unable to set prices differently across nations. D) non-traded goods account for approximately 50 percent of the value of production in an economy.
Economics