Refer to Figure 12-5. The figure shows the cost structure of a firm in a perfectly competitive market. If the firm's fixed cost increases by $1,000 due to a new environmental regulation, what happens to its profit-maximizing output level?
A) It remains the same.
B) It decreases.
C) It increases.
D) It could increase, decrease, or remain constant, depending on whether the firm is able to cut costs somewhere else.
A
Economics
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Which of the following statements is true?
A) An increase in the nominal wage rate leads to a decrease in the real wage rate if the price level is stable. B) In an economy which has a positive inflation rate, the real wage rate is always greater than the nominal wage rate. C) An increase in the real interest rate always encourages higher savings. D) An increase in the real interest rate might discourage savings.
Economics
In the above figure, if the market price is less than $7, the firm
A. produces 10 units. B. produces 0 units. C. produces 8 units. D. produces 11 units.
Economics