Why might very small plots of land be inefficient? Is it then true that the larger the better?
What will be an ideal response?
Inefficiency can be discussed in terms of ability to use certain kinds of inputs such as machinery, and distance between non-contiguous plots. However, the answer should cite studies showing that small plots can be more efficient than large ones, and the reasons for this.
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Which of the following is true of property rights?
a. They are rights to use a public good without paying for it. b. They usually specify the owner's alternatives. c. The are associated with the exchange of commodities but not services. d. They are often open-ended and do not exhaustively specify the owner's alternatives.
In the benchmark competitive case, the firm will expand the hiring of employees until the marginal revenue product is
A. equal to the market wage rate. B. greater than the market wage rate. C. the square of the market wage rate. D. less than the market wage rate.
If businesses in general decide that they have overbuilt and so now have too much capital, their response to this would initially shift
a. aggregate demand right. b. aggregate demand left. c. aggregate supply right. d. aggregate supply left.
What is measured on the vertical axis when we draw a graph of long-run aggregate supply?
A. production of capital goods B. spending on goods and services in an economy C. real GDP D. the price level