Refer to Figure 13-17. Suppose the firm is currently producing Qf units. What happens if it increases its output to Qg units?
A) It will move from a zero profit situation to a loss situation
B) Its average cost of production will fall and its profit will rise.
C) It will move from a zero profit situation to a profit situation
D) It will be taking advantage of economies of scale and will be able to lower the price of its product.
A
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An increase in the U.S. interest rate differential increases the demand for dollars
Indicate whether the statement is true or false
The degree of responsiveness of aggregate output to a price change declines as the:
a. rate of savings increases. b. economy approaches its maximum potential output. c. level of real GDP declines over time. d. the price elasticity of imports declines. e. the excess capacity of all the firms in the economy increases over time.