In a competitive industry with identical firms, long-run equilibrium is characterized by:
A. P > min ATC.
B. MR = MC = min ATC.
C. MR < P.
D. P < AVC.
Answer: B
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Which of the following would indicate that a tax is regressive?
a. High-income people pay $5,000 . low-income people pay $2,000. b. High-income and low-income people pay $200 each. c. High-income people pay 20 percent of their income in taxes; low-income people pay 10 percent. d. Both high-income and low-income people pay 10 percent of their income in taxes. e. Low-income people are exempt from the tax.
Suppose that Captain Canada can produce 100 hockey sticks or 10 gallons of maple syrup in a typical work week, while Captain Germany can produce 90 hockey sticks or 10 gallons of maple syrup in a typical work week. From these numbers, we can conclude
a. Captain Canada has a comparative advantage in the production of hockey sticks. b. Captain Germany has a comparative advantage in the production of maple syrup. c. Captain Canada has an absolute advantage in the production of hockey sticks. d. All of the above conclusions are correct.
Which of the following statements about full employment is true?
A. Liberal economists insist that an unemployment rate of 4 percent constitutes full employment. B. Conservative economists feel that an unemployment rate of 6 percent is a realistic portrayal of full employment. C. Economists cannot agree on what constitutes full employment, thus 5% represents a reasonable compromise. D. All of these choices are true.
An increase in capital increases productivity only if it is purchased and operated by domestic residents
a. True b. False Indicate whether the statement is true or false