Define economics. Who are economic agents?
What will be an ideal response?
Economics is the study of how agents choose to allocate scarce resources and how these choices affect society. An economic agent is an individual or a group that makes choices.
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The above figure shows a perfectly competitive firm. If the market price is $15 per unit, the firm
A) will definitely shut down to minimize its losses. B) will stay open to produce and will make zero economic profit. C) will stay open to produce and will incur an economic loss. D) will stay open to produce and will make an economic profit. E) might shut down but more information is needed about the fixed cost.
The percentage of hours worked by college educated workers since the 1960s has ________
A) fallen B) stayed essentially unchanged C) increased D) moved in the opposite direction of the college premium