Government encouragement of monopoly

A firm is producing 300 units of output at a total cost of $6,000, with a variable cost of $5 per unit. What is the firm’s average fixed cost?

Karam recently opened a bar and grill. Out of the following costs associated with his new business, which is (are) variable costs? (Select all that apply)

In production theory, the short run is defined as _____ and the long run is defined as _____.

To maximize profits (independent of the type of a market the firm is in), a firm should produce where

Suppose the demand curve for backpacks is Q = 38 – 2P. What is the lowest price at which no consumer is willing to buy backpacks (i.e., the demand choke price)?

The demand and supply of detergent are given by QD = 7,000 – 1,000P and QS = 1,000P – 1,000, where P is price per gallon and Q is in gallons. What happens at a price ceiling of $2 per gallon?

A donut shop has noticed that when they increase the price of chocolate donuts by 5%, the quantity demanded of breakfast sandwiches decreases by 1%. The cross-price elasticity of demand for breakfast sandwiches is _____, so the two foods are _____.

Suppose the equilibrium price for renting an apartment is $800 per month. Concerned about the cost to tenants, the government imposes a price ceiling of $400 per month. This policy will _____.

Refer to the following figure. Suppose a firm spends $4,000 per day producing a good. The wage rate per worker is $400 per day and rental rate per unit of capital is $1,000 per day. The firm’s isocost line at the current expenditure level is represented by