If the market price is $50 for a unit of a good produced in a perfectly competitive market and the firm's minimum average variable cost is $52, then to maximize its profit (or minimize its loss) the firm should
A) definitely produce the unit.
B) shut down.
C) not produce the unit but remain open.
D) not produce the unit. Whether the firm should shut down or remain open cannot be determined without more information.
E) produce the unit only if the price exceeds the average fixed cost.
B
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Which of the following statements is true?
A) Corporations can issue stocks and bonds, while proprietorships cannot. B) Corporations face fewer taxes than do proprietorships. C) Corporations have one owner, while proprietorships have many owners. D) Proprietorships have limited liability while corporations have unlimited liability.
When a private transaction imposes costs on others not directly involved in the transaction, _____
a. a negative externality exists b. a positive externality exists c. the good involved in the transaction is a club good d. the tragedy of commons problem arises e. a free rider problem arises