If the marginal factor cost of hiring an additional worker is $10 while the marginal revenue product is $15, then the firm should
A) hire more workers.
B) stop hiring more workers.
C) fire some workers.
D) none of the above: insufficient information to answer the question.
Answer: A
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Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher B. expansionary; higher; potential C. recessionary; higher; potential D. recessionary; lower; lower
In the figure above, consumer surplus at the price that maximizes the profit for an unregulated, single-price monopolist is the area of
A) rectangle 0heb. B) triangle abe. C) triangle eig. D) rectangle 0hgd.
The decisions of today have consequences that lie in the future
Indicate whether the statement is true or false
If the demand curve is P = 48 - 2Q and MC = 0, calculate the lost social welfare that results from a single price monopoly profit maximizing strategy.
What will be an ideal response?