When single-input producer choice sets are non-convex, the first order condition of the profit maximization problem is neither necessary nor sufficient for identifying the profit maximizing production plan.
Answer the following statement true (T) or false (F)
True
Rationale: This is true -- we may have a corner solution at which the first order condition does not hold.
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Refer to the table above. Once trade begins, a possible international price (i.e. terms of trade) for textiles in terms of grapes is
A) $5. B) 2/5. C) 2. D) 4/5.
An increase in immigration would
a. have no effect on the labor supply curve and real wages. b. shift the labor supply curve to the left and increase real wages. c. shift both the labor demand curve and the labor supply curve to the left. d. shift the labor supply curve to the right and decrease real wages.
Say's law argues thatI.overproduction is typical in a market economy.II.supply creates its own demand.
A. I only B. II only C. Both I and II D. Neither I nor II
A nation with abundant capital resources tends to be an exporter of:
A. Labor-intensive products B. Capital-intensive products C. Natural resource-based products D. Consumer products