Refer to the above graph. Consider a monopolist in short-run equilibrium. This monopolist:
A. has a loss per unit equal to DE.
B. will cease production since its economic profits are negative.
C. earns economic profit equal to area ABED.
D. has total fixed costs equal to area BEFC.
Answer: A
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An increase in the money wage rate ________ and an increase in the money prices of raw materials ________
A) shifts the AS curve leftward; shifts the AS curve leftward B) shifts the AS curve rightward; shifts the AS curve rightward C) shifts the AS curve leftward; does not shift the AS curve D) shifts the AS curve leftward; shifts the AS curve rightward E) shifts the AS curve rightward; shifts the AS curve leftward
If rapid increases in oil prices caused price levels to increase and real GDP to decrease in the short run, the economy would experience
A) an increase in the natural rate of unemployment. B) stagflation. C) long-run economic decline. D) hyperinflation.