Explain the difference between a firm's revenue and its profit
What will be an ideal response?
A firm's revenue is the total amount received for selling a good or service. It is calculated by multiplying the price per unit by the number of units sold. A firm's profit is the difference between its revenue and its costs.
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A monopoly firm is producing where its marginal revenue is equal to marginal cost. At this level of output, the firm's price is $3.75 and its average total cost is $4.50 . Is the firm earning a profit? Explain
How could this firm determine whether it should continue to operate in the short run or if it should shut down?
Explain how the existence of unemployment compensation may actually result in a higher unemployment rate than would otherwise occur if there where no such compensation in the first place
What will be an ideal response?