11. In the long run, if Price=$12, ATC=$2, and AVC = $9, a perfectly compeditive

Question

11. In the long run, if Price=$12, ATC=$2, and AVC = $9, a perfectly compeditive firm would decide to.. a. Shut down b. Continue to produce c. Enter the industry d. Exit the industry 12. Which of the following statements is true about economic profit? a. A firm is operating at a loss when economic profit is zero. b. Economic profit is equal to all explicit costs of production. c. Economic profit = accounting profit + Implicit costs d. A firm is earning a normal profit when economic profit is zero 13. Which statement best describes a gain from trade for an importing country. a. Domestic consumers can consume more goods. b. Domestic consumers pay higher prices c. Domestic producers receive higher prices d. Domestic producer can produce more goods 14. A unilaterally mandated protectionist policy that limits the quanity of certain imports is a.. a. Quota b. Tariff c. Voluntary export restraint d. External economy 15. The production function represents the a. Quantity of inputs and output b. Quantity of output and costs c. Quantity of inputs and costs d. None of these are correct

Explanation / Answer

b. Continue to produce

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