What is the difference between decreasing marginal returns and negative marginal returns?
What will be an ideal response?
Decreasing marginal returns occur when the marginal product of an additional worker is less than the marginal product of the previous worker. In this case, if the marginal product of the new worker is positive, the additional worker adds to total product, but adds less than did the previous worker. Negative marginal returns occur when an additional worker actually decreases total product.
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The above figure shows the market for 2 bedroom town homes in San Diego. If a rent ceiling is set at $1,000 per month, what is the maximum rent someone is willing to pay in the black market?
A) $1,300 per month B) $1,000 per month C) $900 per month D) $1,100 per month E) $1,400 per month
________ is considered a high income country, ________ a developing country, and ________ a newly industrializing country
A) Canada; France; Singapore B) Honduras; New Zealand; South Korea C) Japan; Hong Kong; South Korea D) United States; Somalia; Taiwan
If manager performance is easily observable then
A) profits will be maximized for the firm. B) the owner can directly reward the manager. C) the manager will attempt to manipulate the reported profit. D) the firm's stock price will go up.
An asset price "bubble" is created when
A. buyers base their purchase decision upon their expectation that the asset's price will rise. B. buyers base their purchase decision upon solid fundamentals. C. sellers base their sale decision upon their expectation that the asset's price will fall. D. sellers base their sale decision upon solid fundamentals.