A firm sells a product in a purely competitive market. The marginal cost of the product at the current output of 800 units is $3.50. The minimum possible average variable cost is $3.00. The market price of the product is $4.00. To maximize profits or minimize losses, the firm should:
A. Continue producing 800 units
B. Continue production, but produce less than 800 units
C. Increase production to more than 800 units
D. Shut down
C. Increase production to more than 800 units
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The difference between the monetarist and Keynesian views on discretionary monetary policy is that the monetarists
a. believe monetary policy is a stabilizing force and Keynesians believe it is primarily destabilizing. b. Keynesians think that monetary policy is always used effectively. c. believe monetary policy is a destabilizing force and Keynesians believe it is potentially stabilizing. d. favor "fine tuning" the economy by use of monetary policy while the Keynesians do not.
The idea of bounded rationality is used to address all of the following characteristics EXCEPT
A) unbounded selfishness. B) unbounded knowledge. C) unbounded willpower. D) unbounded rationality.