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Terms in this set (32)
Price and total revenue move in the same direction when demand is price
A perfectly competitive firm ________ at the level of output where P = ATC.
A perfectly competitive firm will earn ________ economic profits in the range of output for which the firm's price is above its minimum average total cost.
If a profit-maximizing
firm is currently producing output where MR = MC in the short run, it should
not change output
Total cost is
total amount of satisfaction yielded by the consumption of a good or service.
Total variable cost _____ as output increases, and total fixed cost _____ as output increases
increases, does not change
What are likely to be fixed cost
lease payments for office space
Which of the following is most likely to be variable cost for a firm?
payroll taxes that are paid on employee wages.
is the increase in total cost resulting in producing one more unit
A firm will begin to experience diminishing returns at the point where
marginal cost increases
Total revenue___if price rises and demand is___.
Decrease in income, decrease in quantity demanded
Normal good, positive
Increase in income, decrease in quantity demanded
Inferior good, negative
Recommended textbook explanations
Principles of Economics
N. Gregory Mankiw
Krugman's Economics for AP*
David Anderson, Margaret Ray
Gary E. Clayton
N. Gregory Mankiw
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