If the Average Total Cost Curve Is Always Above the Demand

question 27

Multiple Choice

If the average total cost curve is always above the demand curve of a monopolist:

• A) that monopolist will suffer economic losses.
• B) entry will occur, forcing the monopolist to reduce price and expand output.
• C) the monopolist will earn an economic profit.
• D) the monopolist must be producing inefficiently.

Understand the calculation of the premium tax credit including the factors that affect the credit amount.

Identify and understand the criteria for a qualifying child for the purpose of EIC and other tax benefits.

Differentiate between refundable and nonrefundable tax credits and provide examples of each.

Understand the requirements for the child and dependent care credit, including how it is calculated and how certain statuses (e.g., student status of a spouse) affect it.

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Definitions:

Diagram (A)

A graphical representation used to illustrate or clarify information, processes, or systems.

Price

The amount of money expected, required, or given in exchange for something else.

Quantity

The amount or number of a material or immaterial good considered as a unit or in total.

Long-Run Cost Diagram

A graphical representation that shows how the costs incurred by a firm change over time with varying levels of output when all inputs are variable.