Refer to the below graph of the representative firm in monopolistic competition. Point b indicates:
A. A situation where the firm is earning economic profits
B. The price-output combination that yields maximum profits
C. A point that cannot be the long-run equilibrium point
D. The lowest possible cost of the firm's product
B. The price-output combination that yields maximum profits
You might also like to view...
For any new deposits into the banking system, the deposit expansion multiplier provides
A) no useful information regarding the potential expansion of the nation's money supply. B) an exact prediction of the expansion of the nation's money supply. C) a theoretical limit on the potential expansion of the nation's money supply. D) an argument that deposits don't effect the nation's money supply at all.
Before the flu season begins, Jeremy gets a flu shot. As a result, Jeremy and several of his friends and relatives avoid the flu for the entire flu season. It would make sense to argue that
a. flu shots provide a positive externality, and that flu shots should be subsidized. b. if flu shots are not subsidized, then the number of people getting flu shots will be smaller than the socially optimal number. c. the externality generated by flu shots is more like the externality generated by education than the externality generated by pollution. d. All of the above are correct.