Explain the difference between a firm's revenue and its profit
What will be an ideal response?
A firm's revenue is the total amount received for selling a good or service. It is calculated by multiplying the price per unit by the number of units sold. A firm's profit is the difference between its revenue and its costs.
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Distinguish between production efficiency and allocative efficiency. Explain why many production possibilities achieve production efficiency but only one achieves allocative efficiency
What will be an ideal response?
If a very small country trades with a very large country according to the Ricardian model, then
A) the small country will suffer a decrease in economic welfare. B) the large country will suffer a decrease in economic welfare. C) the small country only will enjoy gains from trade. D) the large country will enjoy gains from trade. E) both countries will enjoy equal gains from trade.
Which of the following could be considered to be a secondary effect caused by making drugs such as marijuana, cocaine, heroin and meth illegal?
a. The higher prices that result from making drugs illegal results in more property theft by users to afford the drugs. b. The usage of police and law enforcement resources to enforce drug laws leads to lower enforcement (and thus a higher amount) of other crimes. c. Without the ability to use the legal system to enforce contracts in these underground markets, violence between buyers and sellers often results when one party to a drug deal does not live up to their end of the bargain, thus the amount of violence in society increases by making drugs illegal. d. When supplying the demand for a product that has been decreed illegal by the government, the supplier has no incentive to refrain from other illegal and equally punishable behaviors, thus increasing crime by making drugs illegal. e. All of the above would be considered valid and important secondary effects of making drugs illegal.
In the table above, the size of the labor force is
A) 80 million. B) 46 million. C) 42 million. D) 40 million. E) 34 million.