In a store that sells souvenirs, suppose an agent receives a $1 commission for each unit sold, and the principal receives the residual profit. As a result,
A) joint profit is maximized.
B) the agent will sell until the principal's marginal cost equals $1.
C) no agent would enter into such a contract.
D) the agent wishes to sell as many units as he can.
D
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The federal minimum wage law demonstrates
a. market equilibrium. b. a societal choice for economic equity over efficiency. c. the function of equilibrium price in a competitive market. d. government intervention to ensure the equilibrium price.
If incomes rose proportionately with prices, then in the absence of taxes
a) money would cease to be a veil b) real GDP would increase c) everyone would be worse off d) prices would have no effect on output or well-being e) resources would be over allocated to the present at the expense of future generations
If inflation is a threat, then the Fed will conduct monetary policy aimed at
A) increasing the interest rate which then will shift aggregate demand to the right. B) decreasing the interest rate which then will shift aggregate demand to the right. C) decreasing the interest rate which then will shift aggregate demand to the left. D) increasing the interest rate which then will shift aggregate demand to theleft.
If you were told that the exchange rate was 1.2 U.S. dollars for one Canadian dollar,that would mean that Canadians would have to spend ____ to buy a $12 watch in New York City
A. 18 Canadian dollars B. 10 Canadian dollars C. 12 Canadian dollars D. 14.4 Canadian dollars