Which one of Linda’s transactions is part of the factor market?
a. She buys gas to drive to work.
b. She pays for a massage.
c. She receives a check for profits from her investments.
d. She gets birthday cash from her Aunt Reva.
c. She receives a check for profits from her investments.
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When a producer is operating efficiently it is producing:
A. at a point on its production possibilities frontier. B. at a point on or under its production possibilities frontier. C. only one good. D. the good in which it has an absolute advantage.
Assuming gasoline and oil to be complementary goods, the effect on the oil market of an increase in the price of gasoline (other things being equal) would best be described as a(n):
a. increase in the demand for oil. b. decrease in the demand for oil. c. increase in the quantity of oil demanded. d. increase in the quantity of oil demanded.
Compared to owners, employees receive a large fraction of their incomes from their employers and are consequently dependent on the fortunes of that company in the marketplace. From a ‘risk-sharing' perspective, an employee tends to prefer:
A. a flat salary. B. year-end based performance pay. C. output-based incentive pay. D. commission-based incentive pay.
The marginal product of labor is defined as
A) the change in total revenue that results when an additional unit of a labor is hired. B) the additional labor required to produce one more unit of output. C) the additional labor cost of producing one more unit of output. D) the change in output that a firm produces as a result of hiring one more worker.