QUESTION 1 1 points Saved When a firm is a price-taking firm, raising the price

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QUESTION 1 1 points Saved When a firm is a price-taking firm, raising the price of the product above the market-determined price will cause sales to fall nearly to zero many other firms produce a product that is identical to the output produced by the rest of the firms in the industry. the price of the product it sells is determined by the intersection of the market demad ad supply curves for the product. all of the above QUESTION 2 1 points Save Answer When economic profit is positive, foreign companies experience loss of market share the firm's owners experience a decrease in their wealth the firm's owners have successfully solved the principle-agent problem. total revenue exceeds total economic cost. QUESTION 3 1 points Save Answer Microeconomics is generally too complex and abstract to be of much use in making real-world business decisions. contributes to the understanding of ordinary business practices or tactics. studies the behavior of individual economic units or segments of the economy. all of the above. both b and c.

Explanation / Answer

Question 2:

Ans- Total revenue exceeds total economic cost.

As  economic profit is the difference between total monetary revenue and total costs, but total costs include both explicit and implicit costs. Economic profit includes the opportunity costs associated with production and is therefore lower than accounting profit. Economic profit also accounts for a longer span of time than accounting profit. Economists often consider long-term economic profit to decide if a firm should enter or exit a market.

Question 3:

Ans- Both b and c

As microeconomics is a branch of economics that studies the behavior of individuals and firms in making decisions regarding the allocation of scarce resourcesand the interactions among these individuals and firms.

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