Which of the following about capital income is not correct?
A) It refers to a firm's revenue.
B) It is also called profit income.
C) It goes to the firms.
D) It accounts for less than 35% of income in advanced countries.
A
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At a level of output when regulators require a natural monopoly to set a price that is equal to marginal cost, the firm
A) makes zero economic profit. B) makes an economic profit. C) incurs an economic loss. D) makes a normal-economic profit. E) makes either zero economic profit or an economic profit, depending on whether the firm's average total cost equals or is less than its marginal cost.
Suppose a monopolistic competitor produces 2,000 units of the good in equilibrium and charges a price of $10 for each unit. If the average total cost of producing 2,000 units of the good is $6, what is the total profit earned by the producer?
A) $8,000 B) $4,000 C) $2,000 D) $20,000