If the firm's marginal cost is a constant $2 per unit, what price will it charge and how many units will it produce if it maximizes its profits?
a. $8 and 2 units
b. $7 and 3 units
c. $6 and 4 units
d. $5 and 5 units
Ans: c. $6 and 4 units
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The distribution of wealth is more unequal than the distribution of income because wealth reflects
a. persistent wage differentials between people of different abilities b. physical assets as opposed to financial assets c. unequal distribution of talents in the population d. unequal access to education e. the distribution of lifetime accumulated assets
Compare and contrast the four market models in terms of the profit-maximizing output level for each, the shut-down rule for each, the probability of long-run economic profits being earned, and their social desirability.
What will be an ideal response?
The following table shows Alex's estimated annual benefits of holding different amounts of money.Average moneyholdings($)Total benefit($)700508005990066100071110074How much money will Alex hold if the nominal interest rate is 8 percent? (Assume she wants her money holdings to be in multiples of $100.)
A. $900 B. $800 C. $1,000 D. $700
Scalping at major sporting events is an example of
A. a black market caused by a price floor. B. the operation of rationing by the market. C. a black market caused by a price ceiling. D. a surplus caused by the existence of price ceilings.