If the MRP of land is greater than its price, a firm should
A. use more land.
B. try to increase the productivity of land.
C. use less land.
D. decrease the price it is willing to pay for land.
Answer: A
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Total fixed cost
A. increases as output increases. B. declines as output increases. C. is always zero. D. remains constant even if the firm shuts down.
Refer to Scenario 17.3. If the fire protection program were not in place, the insurer would not be willing to ensure the warehouse for any amount less than
A) $80. B) $300. C) $3,000. D) $6,000. E) $300,000.
Assume the central bank pursues contractionary monetary policy. What is the first round effect on the value of the domestic currency, if there is low mobility in the international capital markets?
a. The value of the currency rises. b. The value of the currency falls. c. The value of the currency is unaffected. d. The change in the value of the currency is ambiguous.
Which of the following formulas would correctly calculate a monopolist's profit?
a. profit = price – marginal cost b. profit = price – average total cost c. profit = (price – marginal cost) × quantity d. profit = (price – average total cost) × quantity