The importance of the ceteris paribus assumption is that it:
a. allows one to separate normative economic issues from positive economic ones
b. allows one to generalize from the whole to the individual.
c. allows one to analyze the relationship between two variables apart from the influence of other variables.
d. allows one to hold all variables constant so the economy can be carefully observed in a suspended state.
c
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Which of the following best describes a nation's Gross Domestic Product?
A) the market value of all goods and services produced in the economy, including intermediate goods B) the market value of all goods and services less depreciation C) the constant dollar value of all goods produced in the economy during a year period D) the total market value of all final goods and services produced in the economy during a year
If a firm operates at a loss, the loss is equal to TC - TR. If the firm shuts down instead, its loss is equal to FC. Given this, show that price must exceed AVC for the firm to operate at a loss and not shut down
What will be an ideal response?