Refer to the above figure. The firm will just be covering all of its variable cost but none of its fixed cost
A. at prices between $1 and $2.
B. when the price equals $1.
C. when the price equals $2.
D. when the price equals $4.
Answer: B
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A fixed money-supply rule will have the greatest stabilizing effect on output when
A) money demand is unstable and commodity demand is stable. B) both money and commodity demand are unstable. C) both money demand and commodity demand are stable. D) the velocity of money is unstable.
A Consumer Price Index of 120 for a certain year means that the average price of consumer items in that year was
A. 20% higher than the average price of the preceding year. B. 120% higher than the average price in the base period 1982-84. C. 20% higher than the average price in the base period 1982-84. D. about $120 per basket of consumer goods and services.