Assume that a perfectly competitive firm faces the market equilibrium price P*=$6. When the firm maximizes its positive profit in the short-run, its average total cost (ATC) and marginal cost (MC) are most likely as

ATC=6 and MC=4

ATC=6 and MC=6

ATC=4 and MC=4

ATC=4 and MC=6

Some farmland can be used to produce either rice or corn (i.e. two products share the same input). If price of rice decreases, then the

the supply of rice should increase.

the supply of corn should increase.

the demand of corn should increase.

the quantity demanded of rice should decrease.

Which of the following is NOT true at the market equilibrium price?

The quantity demanded equals the quantity supplied.

There are no shortages in demand or surpluses in supply.

Both buyers and sellers have no incentive to change price.

Consumer surplus equals producer surplus.

Which of the following can be referred as the fixed cost in TV manufacturing?

Electric power bill

Salary of workers

Costs of raw materials

Mortgage payment of equipment