The figure above shows cost curves for a perfectly competitive firm. A profit-maximizing firm will break even when market price is:

Suppose the economy is in long-run and short-run equilibrium. The Fed changes its policy by raising the difference between the discount rate and the federal funds rate. In the long run we would expect to observe

A) a higher real national income. B) a lower real national income. C) a higher price level. D) a lower price level.

Which of the following has been a problem faced by the FDIC in its provision of federal deposit insurance?

A) a relatively low number of bank failures each year, which has reduced the need for deposit insurance B) moral hazard arising from the tendency for the highest-risk banks to be those most interested in obtaining deposit insurance in the first place C) adverse selection arising from the tendency for banks to take on more risk after they receive deposit insurance D) moral hazard arising from the tendency for banks to take on more risk after they receive deposit insurance