Refer to the information provided in Table 8.4 below to answer the question(s) that follow.
Table 8.4ProduceUsing TechniquesUnits of Variable KInputs L1 unit of outputA4 4?B2 6????2 units of outputA 7 6?B410????3 units of outputA 8 6?B 6 11Refer to Table 8.4. Assuming the price of capital (K) is $10 per unit and the price of labor (L) is $5 per unit, the lowest long-run total cost of producing one unit of output is
A. $8.
B. $50.
C. $60.
D. $110.
Answer: B
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Answer the following statement true (T) or false (F)
Which of the following actions would most likely have an external benefit?
A) eating a peanut butter sandwich B) throwing trash out your car window as you drive to class C) sleeping D) attending college E) developing a better marketing strategy for Honda
Ernie's Earmuffs produces 200 earmuffs per year at a total cost of $2,000 and $400 of this cost is fixed. If he increases output to 220 earmuffs, his total cost increases to $2100, and his fixed cost remains $400. What is Ernie's marginal cost per earmuff?
A) $105 B) $35 C) $9.55 D) $5
We expect a rise in transfer payments when
a. the needs of the poor receive more publicity b. taxes rise c. GDP rises and inflation soars d. the retirement age remains unchanged over time e. recessions occur