At an output of 17, ATC is $20 and MC is $17. At an output of 18, ATC is $20.20 and MC is $21. We may conclude that the output at which the firm produces at peak efficiency is
A. less than 17.
B. 17.
C. between 17 and 18.
D. 18.
C. between 17 and 18.
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Answer the following statement(s) true (T) or false (F)
1. When labor and capital are complements in production, a higher wage will cause a firm to use more capital in the long run. 2. When a firm's long-run demand curve for labor is derived, the amount of capital employed is held constant. 3. The substitution effect of a rise in the wage may increase or decrease the firm's employment of labor. 4. Derived demand for an input is the process by which individual firm's demand for labor are aggregated to get the industry demand for labor. 5. The substitution effect on labor always decreases the amount of labor employed when the wage rate goes up.
Employment protection laws make it ________ for firms to hire people, which can result in a(n) ________ in the number of people who are structurally unemployed
A) more risky; increase B) more risky; decrease C) less risky; increase D) less risky; decrease
Assume that an association of young workers has lobbied Congress to require that all workers retire once they reach the age of fifty. What impact would this law have on the nation's production possibilities frontier?
A) no impact at all B) The level of unemployment would decrease so the production possibilities frontier would shift outward. C) The nation would move to a new position on its production possibilities frontier but the frontier itself would not shift. D) The production possibilities frontier would shift inward. E) The number of young workers would increase so the production possibilities frontier would shift outward.
What would happen in the foreign exchange market if the European Central Bank raises European interest rates?
A) There will be a decline in the value of the euro. B) There will be a decline in the value of the dollar. C) There will be an increase in the value of the dollar. D) U.S. interest rates will decline.