Firms do NOT use microeconomic models to
A) determine what inputs will be used for production.
B) determine whether they should advertise in the newspaper or on the radio.
C) strategically raise profits over competitors.
D) None of the above.
D
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When the Federal Open Market Committee buys government securities:
a. the reserve requirement of banks decrease. b. the reserve deposits of banks decrease. c. the excess reserves of banks increase. d. the federal funds rate increases. e. the legal reserves of banks decrease.
In answering the question, assume a graph in which dollars are measured on the vertical axis and output on the horizontal axis. Refer to the information. For a purely competitive firm, total revenue graphs as a:
A. straight, upsloping line. B. straight line, parallel to the vertical axis. C. straight line, parallel to the horizontal axis. D. straight, downsloping line.