Assume that an employer discovers that the marginal revenue product of the last two workers that he has hired is less than the wage rate that he is paying them
He is operating in a purely competitive market in both the output that he sells and the labor that he hires. What would you advise this employer to do and why?
It would be advisable if this employer laid off these two workers. The reason is that the wage rate in a competitive market is the same as the marginal cost of labor. Since these two workers are not "paying their way" laying them off will increase the profitability of the firm or lower its losses.
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Ultimately, tariffs ________ the ability of foreign countries to buy the domestic country's exports and therefore ________ wealth
A) increase; create B) increase; destroy C) reduce; create D) reduce; destroy
Aimee sells hand-embroidered dog apparel over the Internet. Her annual revenue is $128,000 per year, the explicit costs of her business are $42,000, and the opportunity costs of her business are $30,000. What is her accounting profit?
A) $12,000 B) $56,000 C) $86,000 D) $98,000
To restrict a wilderness area in the public domain to a particular group in the general public, say the motorists or snowmobilers of today, is
(a) democratic. (b) consistent with Thomas Jefferson's view on federal ownership of land. (c) undemocratic. (d) non-discriminatory.
In the short run, fiscal policy has its primary affect on aggregate demand but in the long run fiscal policy can influence saving, investment and economic growth
a. True b. False Indicate whether the statement is true or false