-Refer to the Above Figure

question 359

Multiple Choice

-Refer to the above figure.If the market price is equal to A,which statement can be made about economic profits?

• A)Economic profits are positive and equal to ABCG.
• B)Economic profits are positive and equal to ABEF.
• C)Economic profits are negative and equal to GCEF.
• D)Economic profits are negative and equal to ABQ * 0.

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Definitions:

Equilibrium Quantity

The quantity supplied and the quantity demanded at the equilibrium price.

Loanable Funds

The money available for borrowing in the financial market, determined by the level of savings and the supply of credit.

National Saving

The total of private savings and government savings, essentially the portion of national income that is not consumed or spent by government.

Open-Economy Macroeconomic Model

A framework used to evaluate the interactions between a country’s macroeconomy and the global economy, taking into account trade, foreign investment, and exchange rates.