Which of the following statements best reflects a price-taking firm?
a. If the firm were to charge more than the going price, it would sell none of its goods.
b. The firm has an incentive to charge less than the market price to earn higher revenue.
c. The firm can sell only a limited amount of output at the market price before the market price will fall.
d. Price-taking firms maximize profits by charging a price above marginal cost.
a
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Suppose a market were currently at equilibrium. A rightward shift of the supply curve would cause a(n)
A) increase in price but a decrease in quantity. B) decrease in price but an increase in quantity. C) increase in both price and quantity. D) decrease in both price and quantity.
For the U.S. economy, which of the following represents the largest component of GDP?
A) imports B) investment C) government spending D) exports E) none of the above