Questions from General Economics

Q: Assume the supply and demand curves for a good are given by

Assume the supply and demand curves for a good are given by the following equations: Qd = 1000 - 20P ; Qs = 5P. What is the equilibrium price and quantity?

Q: If a profit-maximizing firm is producing an output level in

If a profit-maximizing firm is producing an output level in which marginal revenue exceeds marginal cost, should it produce more, less or the same?

Q: If a profit-maximizing firm is producing an output level in

If a profit-maximizing firm is producing an output level in which marginal revenue equals marginal cost, then is this firm earning a profit?

Q: If a firm has TFC = $2,000 per day

If a firm has TFC = $2,000 per day, and is currently losing $1,500 per day, should the firm shut down?

Q: If a firm is producing where MR =MC, and at

If a firm is producing where MR =MC, and at that output level TR = $4,500, TC = $5,000, and TVC = $4,000 per week, is the firm making or losing money? How much? Should the firm shut down?

Q: What is the general cause of all recessions? All expansionary phases

What is the general cause of all recessions? All expansionary phases of the business cycle?

Q: If a competitive industry is currently losing money, what can be

If a competitive industry is currently losing money, what can be expected to happen to the number of sellers, the price of the product, the volume of output and losses in this industry over time?

Q: If a competitive industry expands and higher wages must be paid to

If a competitive industry expands and higher wages must be paid to attract more workers then what will the long-run supply curve for this industry look like?

Q: What are some barriers to entry that may prevent potential competitors from

What are some barriers to entry that may prevent potential competitors from entering a market?

Q: What are the two major problems associated with a recession?

What are the two major problems associated with a recession?