In the short run, a firm that finds itself earning a loss should compare the market price to which cost in order to determine how to minimize its losses?
A. Average total costs
B. Average variable costs
C. Marginal costs
D. Fixed costs
B. Average variable costs
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Refer to the diagram. The budget line shift that moves the consumer's equilibrium from point A to point B suggests:
A. an increase in the demand for product X.
B. a decrease in the demand for product X.
C. no change in the demand for product X.
D. that X is an inferior good.
Fred purchases a bond, newly issued by the Big Time Corporation, for $10,000. The bond pays $400 to its holder at the end of the first, second, and third years and pays $10,400 upon its maturity at the end of four years. The principal amount of this bond is ________, the coupon rate is ________, and the term of this bond is ________.
A. $10,000; 4 percent; four years B. $10,000; $400; 4 percent C. $400; 40 percent; four years D. $10,400; 4 percent; four years