Because of the relationship between a perfectly competitive firm’s demand curve and its marginal revenue curve, the profit maximization condition for the firm can be written as A) P = MR. B) P = AVC. C) AR = MR. D) P = MC. E) P = AC. ANSWER D
Date: September 9th, 2020
Which of the following is true regarding the game in Scenario 13.5? A) Only Bull Meat has a dominant strategy. B) Only Deer Meat has a dominant strategy. C) Both companies have a dominant strategy: expand West. D) Both companies have a dominant strategy: expand South. E) Neither company has a dominant strategy. ANSWER […]
Date: September 9th, 2020
When states make car insurance mandatory for all drivers, it A) raises rates for everyone because it brings bad drivers into the pool. B) raises rates for high-risk drivers. C) may lower rates for all drivers to the extent that it keeps low-risk drivers in the pool. D) prevents high-risk drivers from “selecting out,” to […]
Date: September 9th, 2020
Credit histories allow firms to A) identify high-risk borrowers, so they can be eliminated and interest rates kept down for others. B) increase the number of credit cards issued, and interest rates go up as a result. C) increase the number of credit cards issued, and interest rates go down as a result. D) lower […]
Date: September 9th, 2020
If clerical workers in your state voted to have a union represent them in negotiations with employers, they would have monopoly power in wage determination. Employers would be in no position to exert monopsony power in their employment of clerks in this market due to the large number of employers in the market. Labor supply […]
Date: September 9th, 2020
Which of the following questions is addressed when hiring capital, but not addressed when hiring labor? A) How much are future profits worth today? B) How much are today’s profits worth in the future? C) How much are the future’s profits worth in the future? D) How much are today’s profits worth today? E) All […]
Date: September 9th, 2020
Refer to Figure 6.1. At which point on the total product curve is the average product of labor the highest? A) point A. B) point B. C) point C. D) point D. E) none of the above ANSWER B
Date: September 9th, 2020
Private income and wealth completely determine how many goods and services one consumes. Indicate whether the statement is true or false ANSWER F
Date: September 9th, 2020
Suppose the aggregate demand for housing in the U.S. includes a substantial speculative component. What happens of the expectations of speculators change, and they believe housing prices will not increase in the future? A) The aggregate demand curve shifts leftward, and the equilibrium market price declines. B) The aggregate demand curve shifts leftward, and the […]
Date: September 9th, 2020
The amount of output that a firm decides to sell has no effect on the market price in a competitive industry because A) the market price is determined (through regulation) by the government B) the firm supplies a different good than its rivals C) the firm’s output is a small fraction of the entire industry’s […]
Date: September 9th, 2020
