Under perfect competition and monopolistic competition, profits are zero in long-run equilibrium.

If the Fed wished to decrease interest rates, it could

A) increase the reserve requirement or conduct an open market sale. B) increase the reserve requirement or conduct an open market purchase. C) decrease the reserve requirement or conduct an open market sale. D) decrease the reserve requirement or conduct an open market purchase.

The figure above shows a perfectly competitive firm. The firm is operating; that is, it has not shut down. The firm produces

A) 20 units of output and makes zero economic profit. B) 20 units of output and incurs an economic loss. C) 10 units of output and makes zero economic profit. D) 10 units of output and incurs an economic loss.