Refer to the Accompanying Figure to Answer the Following Questions

question 128

Multiple Choice

Refer to the accompanying figure to answer the following questions.

-The demand curve for Arnold's Airport Shuttle is downward sloping.With only this information,it can be concluded that Arnold's Airport Shuttle

• A) is the only firm in the market for airport shuttles.
• B) is currently maximizing profits.
• C) is a price maker.
• D) makes economic profits.
• E) should produce where the demand curve crosses marginal cost.

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Definitions:

Residual Income

The amount of income that an individual or company retains after accounting for all costs and expenses.

Producer Price Index

An economic indicator that measures the average changes in prices received by domestic producers for their output.

Net Income

The total profit of a company after all expenses and taxes have been subtracted from revenues.