Supply and Demand

If both marginal cost and marginal revenue increase, a firm ? A. Should increase output B. Should reduce outputC. will require further information on how to respond D. Should not change output

A firm that breaks even after all economic costs are paid is earning ? A. Economic profit B. Accounting profitC. Normal profit D. Supernormal profit

If a firm wage costs increase this will cause __________ and __________? A. marginal cost to increase, output to fall B. marginal revenue to increase output to fall C. opportunity cost to increase the firm will close D. average cost will rise output will increase ____ output and an upward shift in marginal revenue ____…

Profits are maximized when ? A. costs are minimized B. revenue is maximized C. average cost is less than average revenueD. marginal cost equals marginal revenue

The increase in total cost when one more unit is produced is known as ? A. marginal cost B. opportunity cost C. limited costD. average cost

Adding up the quantities demanded of a good by different people facing the same price gives us the ? A. Supply curveB. Market demand curve C. Demand curve D. Market supply curve

Economics assumes that people consume goods and services to achieve ? A. Status B. PrestigeC. Utility D. Self-esteem

The income effect of a price increase of a normal good is to ________ of that good and the substitution effect is to _________ of that good? A. increase quantity demanded, reduce quantity demanded B. increase quantity demanded, increases quantity demandedC. reduce quantity demanded, reduce quantity demanded D. reduce quantity demanded, increase quantity demanded

Inferior goods have _________ and luxury goods have _________? A. negative income elasticity income elasticity greater than 1 B. income elasticity greater than 1, negative income elasticities C. Positive income elasticities, negative income elasticities D. None of the above

Positive cross elasticities suggest that goods are ____ and negative cross-elasticities that goods are ? A. substitutes inferior B. normal, complementsC. substitutes complements D. normal, inferior