Nonprofit, or not-for-profit, firms
a. maximize revenue instead of profit
b. minimize cost rather than maximize profit
c. often pursue goals other than profit maximization
d. pursue profit as their main goal despite their name
e. have no incentive to produce efficiently
C
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Firms in perfectly competitive industries are unable to control the prices of the products they sell and earn a profit in the long run. Which of the following is one reason for this?
A) Firms from other countries are able to produce similar products at lower costs. B) Firms in perfectly competitive industries can use advertising in the short run to persuade consumers that their products are better than those of other firms. But eventually consumers realize that all of the firms sell virtually identical products. C) Firms in these industries sell identical products. D) Owners of perfectly competitive firms realize that their short-run profits are temporary. Therefore, they either sell their businesses or develop other products that will earn short-run profits.
The graphs above show the production possibilities curves for the U.S. and Canada, which both produce cars and wheat. Based on the graphs above, which of the following is true?
A) The opportunity cost of a car in the U.S. is 1 unit of wheat. B) The opportunity cost of a car in the U.S. is 5 units of wheat. C) The opportunity cost of a car in Canada is 1/2 unit of wheat. D) The opportunity cost of a car in Canada is 2 units of wheat.