When a competitive firm hires labor up to the point at which the value of the marginal product of labor equals the wage, it also produces up to the point at which the price of output equals average variable cost
a. True
b. False
Indicate whether the statement is true or false
False
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The price of good A goes up. As a result the demand for good B shifts to the left. From this we can infer that:
A) good A is a normal good. B) good B is an inferior good. C) goods A and B are substitutes. D) goods A and B are complements. E) none of the above
When there are omitted variables in the regression, which are determinants of the dependent variable, then
A) you cannot measure the effect of the omitted variable, but the estimator of your included variable(s) is (are) unaffected. B) this has no effect on the estimator of your included variable because the other variable is not included. C) this will always bias the OLS estimator of the included variable. D) the OLS estimator is biased if the omitted variable is correlated with the included variable.
If the demand for a good is elastic, then total revenue
a. increases as price increases b. remains constant as quantity demanded increases c. increases as price decreases d. decreases as quantity demanded increases e. decreases as price decreases
The replacement ratio is defined as
a) The cost of replacing a worker b) The cost of employing a new worker relative to the value of output they could produce c) The cost of replacing capital relative to the book value of existing capital d) Unemployment benefit as a share of previous earnings e) None of the above