Refer to Figure 8.1. At the profit-maximizing level of output,
A) AVC is minimized.
B) ATC is minimized.
C) MC is minimized.
D) total cost is minimized.
E) no costs are minimized.
E
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The sacrifice ratio is
A) the amount of output lost when the inflation rate is reduced by one percentage point. B) the percentage reduction in inflation when output falls one percentage point below potential. C) the percentage change in employment when output declines by one percentage point. D) the number of percentage points that the unemployment rate rises when output declines by one percentage point.
A firm advertising using an expensive, famous spokesperson is often
A) aimed to raise rivals' costs. B) used to increase the total market demand. C) used to steal customers from rivals. D) used to focus on general problems the product addresses.