If you can buy 9 DVDs for $126 or you could buy 10 DVDs for $130, then the marginal cost of the tenth DVD is
A. $4.
B. $13.
C. $14.
D. $130.
Answer: A
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Any point on a country's production possibilities frontier represents a combination of two goods that an economy
a. will never be able to produce. b. can produce using all available resources and technology. c. can produce using some portion, but not all, of its resources and technology. d. may be able to produce in the future with more resources and/or superior technology.
What is an agreement among members of an oligopoly to set prices and production levels called?
(A) Price leadership. (B) Competition. (C) Imperfect monopoly. (D) Collusion.
If Figure 8.1 depicts the current situation for a monopolistically competitive firm, then in the long run we expect:
A. the firm's demand curve to shift to the left. B. the firm's demand curve to shift to the right. C. the price of the good to increase. D. the quantity of the good sold by the firm to increase.
Homer earns $10,000 per year. Each year he spends $5,000 and saves $5,000. He pays a 5 percent sales tax on all of his spending. Assuming the sales tax is the only tax he pays, his average tax rate out of his income is
A) 0 percent. B) 2.5 percent. C) 3.5 percent. D) 5.0 percent.