The Figure Given Below Shows Three Short Run Average Total

question 5

Multiple Choice

The figure given below shows three Short Run Average Total Cost (SRATC) curves and the Long Run Average Total Cost (LRATC) curve of a firm.Figure 8.3

-A firm wishing to maximize profits will produce at the level of output where:

• A)marginal cost is equal to zero.
• B)its total cost curve intersects its total revenue curve.
• C)its costs are at a minimum.
• D)total revenue exceeds total cost by the largest amount.
• E)marginal revenue exceeds marginal cost by the greatest amount.

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Definitions:

Money Supply

The grand total of all economic assets measured in currency available at a specific time in an economy, which covers coins, banknotes, and the balances in checking and savings accounts.

Money Supplied

The entire sum of assets in terms of money present within an economy at a given time.

Money Demanded

Money demanded refers to the total amount of money that individuals and businesses in an economy want to hold at any given time, influenced by interest rates and economic activity.

Equilibrium Interest Rate

The interest rate at which the demand for loanable funds equals the supply of loanable funds in the economy, balancing saving and borrowing.