Exhibit 2-7 Production possibilities curve
For the economy shown in Exhibit 2-7 to operate at point C, it must:
A. be willing to lower the price of grain.
B. use its given resources more efficiently than it would at point A.
C. experience resource unemployment.
D. experience an increase in its resources and/or an improvement in its technology.
Answer: D
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In the Cournot model, if the products are differentiated,
A) this reduces the pressure of one firm's decisions on the other. B) this increases the pressure of one firm's decisions on the other. C) there is no difference between this model and one with homogeneous goods. D) marginal costs are necessarily different.
Refer to Figure 14.2. The substitution effect of the wage decrease on the amount of hours of leisure is:
A) L1 to L0. B) L0 to L1. C) L1 to L2. D) L2 to L0. E) none of the above
The U.S. labor force participation rate has changed over time, as has the participation rate of various segments of the U.S. population due to social changes. Choose one social change that you expect to happen in the coming decades. Explain how this will affect the labor force participation rate of various demographic groups.
What will be an ideal response?
The rule of reason refers to the interpretation of the courts that dominant firms should be broken up because of their:
A. market share dominance, regardless of their business practices. B. illegal business practices, not based on their market dominance alone. C. marginal cost pricing, rather than average cost pricing. D. average cost pricing, rather than marginal cost pricing.