Life insurance companies often give applicants a physical examination to prevent
A) the person from dying before obtaining the policy.
B) signaling.
C) adverse selection.
D) profit maximization.
C
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Suppose that when a perfectly competitive firm produces 1,000 units of output, its total variable cost is $1,900. If the marginal cost of producing the 1,000th unit is $1.70, and if the market price of each unit of output is $1.70, then the firm should:
A. shut down. B. increase output. C. raise its price. D. continue to produce 1000 units.
According to your text, who among the following have a comparative advantage in providing information that reduce transaction costs?
A) The consumer B) The bureaucrat C) The middleman D) The career politician
If marginal cost is less than average variable cost,
A. average variable cost is falling. B. average variable cost is constant. C. average variable cost is rising. D. there is no way to determine if average variable cost is falling, constant, or rising.
Given a price elasticity of demand of -0.9, a decrease in price will
A. decrease quantity. B. increase total revenue. C. reduce total revenue. D. leave total revenue unchanged.