This table shows the total costs for various levels of output for a firm operating in a perfectly competitive market.PriceQuantityTC$500$10.00$501$20.00$502$27.50$503$77.50$504$147.50$505$250.00According to the table shown, the firm's profit is:
A. maximized at 5 units of output.
B. not maximized at any level of output given.
C. maximized at 4 units of output.
D. maximized at 3 units of output.
Answer: D
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If price is cut and demand is inelastic, total revenue will fall because
A) the change in quantity demanded is less than the percent change in price. B) the percent change in quantity demanded is less than the change in price. C) the percent change in quantity demanded is less than the percent change in price. D) customers can find substitutes.
According to Keynesians, an increase in the money supply will have its least impact on GDP and the greatest impact on the price level when the aggregate demand curve intersects
a. the horizontal portion of the aggregate supply curve b. the vertical portion of the aggregate supply curve c. the upward sloping portion of the aggregate supply curve d. either the horizontal or upward sloping portion of the aggregate supply curve e. either the horizontal or upward sloping portion of the aggregate supply curve