Question

Suddenly there is an increase in the demand for Frisbees. The most likely result would be...

Suddenly there is an increase in the demand for Frisbees. The most likely result would be

A firm will not produce where MR=MC when

a.

It is making an operating profit
b.

It is earning negative economic profits
c.

It is making an operating loss
d.

It is earning positive economic profit

Households are

a.

Suppliers in the input market
b.

Demanders in the labor market
c.

Demanders in the input market
d.

Suppliers in the product markets

The short run is a period of time during with

a.

The scale of production is fixed
b.

All resources are variable
c.

The scale of production is variable
d.

All resources are fixed
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Homework Answers

Answer #1

Q1 Answer is D.

If demand increased price will increase and firm will be earning positive economic profit.

Q2 Answer is A.

Households are suppliers of inputs in the market. Like labour is supplied by households and savings are supplied to investors by households and they use it as investment.

So households are suppliers of inputs and demanders of products.

Q3 Answer is A. Scale of production is fixed because production can not be increased immediately.

#Please rate positively...thank you

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