When an economy grows out of a recession, normally the demand for bonds ________ and the supply of bonds ________, everything else held constant

Refer to the above figure. S1 is the supply curve that includes only private costs. S2 is the supply curve that includes social costs. From this figure we know that

A) an external benefit exists. B) private costs are less than social costs. C) private costs equal social costs. D) private costs are greater than social costs.

A perfectly competitive firm is selling 300 units of output at $4 each. At this output level, total fixed cost is $100 and total variable cost is $500. The firm

A) is maximizing its profit. B) is earning a profit, but not necessarily the maximum profit. C) is experiencing an economic loss. D) should shut down.