The capital stock is fixed at 50 units, the price of capital is $30 per unit, and the price of labor is $25 per unit. 
Given the above, if the firm produces 20 units of output, what is average fixed cost?
A. $600
B. $150
C. $50
D. $1.50
E. none of the above
Answer: E
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The textbook states that in attacking moral hazard, having both risk-based capital requirements and risk-based deposit insurance premiums
A) is necessary, to deal with the problem from both sides of the bank's balance sheet. B) is redundant and that one of the policies should be ended. C) is necessary in order to deal with the moral hazard of both bankers and depositors. D) may be redundant in theory but advisable in practice given the difficulty of measuring risk.
Which of the following are NOT characteristics of a competitive market?
A) There is freedom of entry and exit. B) There are zero transaction costs. C) There are only one or two sellers. D) Buyers and sellers have complete information.
Slick Shades has a constant marginal cost of production equal to $40 and the distributors have a constant marginal cost of distribution equal to $20. If Slick Shades is producing the profit-maximizing number of sunglasses (in hundreds), what is the profit-maximizing wholesale price?
The figure above shows the wholesale demand and marginal revenue curves for Slick Shades Sunglasses, a sunglasses firm with market power. Slick Shades Sunglasses has a constant marginal cost of production and it sells to perfectly competitive independent retail distributors that have a constant marginal cost of distribution.
A) $110
B) $120
C) $140
D) $130
In a country with a working-age population of 22 million, 16 million are employed, 2 million are unemployed, and 1 million of the employed are working part-time, half of whom wish to work full-time. If 500,000 of those unemployed are cyclically unemployed, what is the natural unemployment rate?
A) 9.4 percent B) 11.1 percent C) 5.6 percent D) 8.3 percent E) none of the above