If price is greater than average variable cost, then the firm
a. should cease production
b. earns economic profits
c. just breaks even
d. makes an economic loss
e. may make either an economic profit or loss
E
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Which of the following is true for a constant cost industry? a. It uses a relatively large share of available resource inputs
b. It uses a relatively small share of available resource inputs. c. Industry expansion will put upward pressure on wages and/or other input prices. d. Both a. and c.
Which of the following is a reason for the law of increasing opportunity cost? a. Some goods have limited alternative uses
b. Not all resources are equally adaptable to other uses. c. Prices of specific final goods increase as more of those goods are produced. d. Prices of specific final goods decrease as more of those goods are produced.