Suppose the economy is at full employment and firms become more optimistic about the future profitability of new investment. Which of the following will happen in the short run?

Higher wages that compensate workers for unpleasant aspects of a job are called compensating differentials

Indicate whether the statement is true or false

If a perfectly competitive firm is operating in the short run and seeks to maximize profit, the firm should:

a. increase output whenever marginal cost is less than average total cost. b. increase output whenever marginal revenue is less than marginal cost. c. choose the output where per-unit profit is greatest d. increase output whenever price exceeds marginal cost.