Jane's utility function is represented as: U = F0.5 C0.5, F is quantity of food and C is quantity of clothing. If her budget constraint is represented as: 120 = 2F + C, her optimal bundle of consumption should be
A) (40F, 40C).
B) (20F, 60C).
C) (50F, 50C).
D) (45F, 20C).
A
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A rent ceiling results in a shortage. As a result, which of the following do you expect?
A) The shortage will persist as long as the ceiling is in effect. B) Discrimination as landlords choose their tenants, possibly based on race, age, or gender. C) A black market for apartments whereby higher rents are obtained through various other charges. D) All of the above would be expected.
In a competitive labor market, with one variable factor, the supply of labor to the firm is
A) equal to the marginal expenditure curve. B) equal to the demand curve for labor. C) greater than the marginal expenditure curve. D) equal to the marginal revenue product curve.
By itself, the substitution effect of an increase in the wage rate will
a. always lead to an increase in the quantity of labor supplied b. always lead to a decrease in the quantity of labor supplied c. lead to an increase in the quantity of labor supplied only if leisure is like a normal good d. lead to an increase in the quantity of labor supplied only if leisure is not a normal good e. lead to an increase in the quantity of labor supplied only if the income effect works in the same direction
BP has
A) only used external markets. B) used internal markets successfully to reduce emissions. C) used internal markets to deal with a network externality. D) none of these choices.