Refer to the graph shown depicting a perfectly competitive firm. If average variable cost is $3 at quantity 450, points A through E represent the:
A. demand for the firm's product.
B. firm's supply curve.
C. firm's total revenue curve.
D. firm's total cost curve.
Answer: B
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Consider a lake stocked with fish. The total value of fish caught at the lake depends on the number of fishers, as shown in the accompanying table. As the table indicates, 1 fisher can catch $36 worth of fish in a day, 2 fishers can catch a total of $66 worth of fish, 3 fishers can catch a total of $90 worth of fish, and so forth. The fishers are identical, and the opportunity cost of a day at the lake is $18 for each fisher.
(i) Complete the table by calculating the value of each fisher's catch, on average, and the social marginal benefit of the lake.
(ii) If use of the lake is nonexcludable, how many fishers come to the lake? What is the total value of their catch? What is their total cost? What is the social gain from the existence of the lake?
(iii) What is the optimal number of fishers at the lake? What is the social gain if this optimum is achieved?
(iv) What entrance fee would lead to the optimal outcome?
If the Fed purchases $50,000 in T-bills from a bank, by how much will the bank's excess reserves increase?
A) by $50,000 B) by $50,000 times the required reserve ratio C) by $50,000 divided by the required reserve ratio D) Not enough information has been provided to answer the question.
We know that a firm is paying way below the market wage rate if
A. the number of applications for a job posting is low and the quit rate is high. B. the number of applications for a job posting and the quit rate are low. C. the number of applications for a job posting and the quit rate are high. D. the number of applications for a job posting is high and the quit rate is low.
Suppose that the consumer price index at year-end 2004 was 140 and by year-end 2005 had risen to 150. What was the inflation rate during 2005?
What will be an ideal response?