A competitive firm will use a factor of production as long as its marginal revenue product exceeds its unit cost.
Answer the following statement true (T) or false (F)
True
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Suppose that the total production of an economy consists of 10 oranges and 5 candy bars, each orange sells for $0.20, and each candy bar sells for $1.00. What is the market value of production in this economy?
A. $7.00 B. $1.20 C. $2.00 D. $5.00
Marginal cost is equal to the
A) change in total cost divided by the change in output. B) change in average total costs divided by the change in output. C) change in average product divided by the change in output. D) change in total product divided by the change in output.
Which of the following statements is true for markets in which the demand curve slopes downward and the supply curve slopes upward?
a. As the size of the tax increases, tax revenue continually rises and deadweight loss continually falls. b. As the size of the tax increases, tax revenue and deadweight loss rise initially, but both eventually begin to fall. c. As the size of the tax increases, tax revenue rises initially, but it eventually begins to fall; deadweight loss continually rises. d. As the size of the tax increases, tax revenue rises initially, but it eventually begins to fall; deadweight loss falls initially, but eventually it begins to rise.
The reason that the local telephone company is able to engage in price discrimination between business and residential customers in providing local phone service is that:
A. it is the only provider of local (landline) telephone service. B. it must be extremely difficult, if not impossible, for one consumer to resell phone service to another. C. business and residential customers differ in their willingness to pay for phone service. D. All of these are correct.