Assume that the graphs show a competitive market for the product stated in the question below.
Select the graph above that best shows the change in the market following a tax placed on the suppliers in the market.
A. graph (1)
B. graph (2)
C. graph (3)
D. graph (4)
Answer: D
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If a firm adds one more worker and total output increases from 100 to 120, the marginal product of labor equals
a. 220. b. 120. c. 100. d. 20.
Economic profits are equal to
A) total revenues minus total fixed costs. B) total revenues, after tax, minus cost of goods sold. C) total revenues minus the implicit and explicit costs of all inputs used. D) total revenues minus the opportunity cost of labor.
The bulk of exports from industrial countries are
a. manufactured goods b. primary products c. agricultural goods d. raw materials e. raw sugar products
The bundling of mortgages together and the issuing of securities for their financing made it possible for investment banks to
a. reduce their exposure to risk in the event that the overall mortgage default rate rose. b. reduce the amount of capital required to back these bundled securities. c. build up large reserves so they would be able to meet their obligations even if the mortgage default rate rose substantially. d. quickly access funds to meet short-term debt obligations.