Assume Congress decides that oil companies are making too much profit and decides to tax oil companies for each gallon of gasoline produced. This would
A) shift the marginal cost curve up.
B) shift the marginal cost curve down.
C) shift the average fixed cost curve up.
D) shift the average fixed cost curve down.
A
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Budget deficits are important because deficits
A) cause bank failures. B) always cause interest rates to fall. C) can result in higher rates of monetary growth. D) always cause prices to fall.
Refer to the graphs above. Suppose a firm is currently producing 500 computers per week and charging a price of $1000. How will the firm respond to a positive demand shock if prices are inflexible?
A.
The firm will increase production to 650 computers per week and charge a price of $1000
B.
The firm will continue to produce 500 computers per week and charge a price of $1000
C.
The firm will cut production to 300 computers per week and charge a price of $1000
D.
The firm will cut production to 300 computers per week and charge a price of $600