Based on the table above, the equilibrium price level is
A) 130.
B) 120.
C) 110.
D) 100.
E) 90.
C
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Marginal rates of technical substitution (MRTS) represent
A) the optimum combinations of inputs. B) cost-minimizing combinations of inputs. C) the degree to which one input can replace another without output changing. D) All of the above
Over the past 40 years, there has been an increase in spending on public education without a significant increase in student performance. One explanation given by economists on why student performance has not improved is that
A) not enough funds have been spent on public education. B) schools are providing high-priced services that are not valued by parents. C) the quantity of educational services has not increased beyond the pre-subsidy equilibrium. D) too much competition for educational services.
Suppose a family-owned donut shop has $80,000 in total revenues, $36,000 in rent, and $20,000 in additional operating costs. The husband and wife work in the shop and pay no wages to themselves or others. The economic profits from the donut shop are
A) $24,000. B) less than $24,000. C) more than $24,000. D) $80,000.
Why does a monopoly cause a deadweight loss?
A) because it stops producing output at a point where price is above marginal cost B) because it appropriates a portion of consumer surplus for itself C) because it increases producer surplus at the expense of consumer surplus D) because it does not produce some output for which demand exceeds supply