Assume that capital and labor are complementary inputs. If the firm increases the amount of capital it employs, this would
A. cause the firm to move up along its MP schedule for labor.
B. shift the firm's MP schedule for labor to the left.
C. shift the firm's MP schedule for labor to the right.
D. cause the firm to move down along the MP schedule for labor.
Answer: C
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Which of the following is a factor of production?
A) an acre of forested land B) $25,000 in cash C) a U.S. Treasury bond D) 20 shares of Ford stock
According to the circular flow model, an increase in spending by businesses on productive resources would cause the income and spending of consumers to increase
Indicate whether the statement is true or false
Which of the following statements about natural monopoly is correct?
A) Governments regulate natural monopolies in order to ensure that costs of production are minimized. B) Governments regulate natural monopolies in order to ensure that the firm earns a normal profit. C) Governments regulate natural monopolies in order to prevent them from making profits. D) Governments regulate natural monopolies in order to keep their workers from earning wages that are too high.
Suppose price decreases from $27.00 to $13.00. Using the mid-point formula, the percentage change in price is:
A. 0.35 = 35 percent. B. 0.7 = 70 percent. C. 0.7 = 70 percent. D. 14 percent.