Which of the following best describes a production function?
A. The relationship between consumer preferences and market demand.
B. The relationship between the quantity of labor employed and total cost.
C. The relationship between the maximum amounts of output a firm can produce and various quantities of inputs.
D. The relationship between price and quantity supplied by sellers in a market.
Answer: C
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Trade deficits always lead to future decreases in consumption if the trade deficits
A) support current investment. B) support current consumption. C) require borrowing from abroad. D) support either current investment or current consumption.
Which of the following are theories of the BOT?
A) monetary approach B) absorption approach C) elasticities approach D) Both B and C
Suppose there are four firms in an industry. The market shares of the four firms are 5 percent, 20 percent, 35 percent, and 40 percent. The Herfindahl-Hirschman index for that industry is
A) 6,650. B) 3,250. C) 1,250. D) 100.
Microsoft issues a 2-year bond with a face value of $5,000 . In addition to the principal paid at maturity, the bond has 2 annual coupon payments of $500 each, to be received at the end of the first and second year respectively. If the interest rate is 10 percent (0.10) per year, what is the value of the newly issued bond?
a. $5,000.00 b. $6,000.00 c. $5,886.68 d. $4,901.48 e. $41.32