Figure 10.1 depicts a firm's marginal revenue product curve. The marginal revenue product curve is negatively sloped because ________ decreases as the firm uses more labor.
A. the hourly wage
B. the marginal product of labor
C. the product price
D. None of these
Answer: B
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Which of the following statements is true of the gains to trade?
A) The gains to trade expand as trading partners become more alike. B) The gains to trade shrink as trading partners become more alike. C) The trading nations can enjoy gains to trade even when none of these countries has a comparative advantage in the production of any good. D) The gains to trade are equal for all trading partners.
In the above figure, if the budget line shifts from RT to RS, the income effect is illustrated by the move from
A) a to b. B) a to c. C) b to c. D) T to S.
An average cost pricing rule for a natural monopoly sets the price ________ the marginal cost, thereby ________ a deadweight loss
A) below; avoiding B) below; creating C) above; avoiding D) above; creating
"Even if there is a liquidity trap or interest-insensitive investment, a falling price level will increase the real money supply and real wealth, and this impacts consumption"
This is a statement a __________ economist might make as an explanation of why the economy __________ pull itself out of a recession. A) Classical; will B) Classical; may not be able to C) Keynesian; will D) Keynesian; may not be able to