In Figure 45.5, where one union is bargaining against one employer, the highest possible negotiated wage paid to workers will be 
Figure 45.5
A. W*.
B. W2.
C. W1.
D. an undetermined point between W1 and W2.
Answer: C
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A perfectly competitive firm definitely makes an economic profit in the short run if price is
A) equal to marginal cost. B) equal to average total cost. C) greater than average total cost. D) greater than marginal cost. E) greater than average variable cost.
Price decreases always increase economic efficiency
a. True b. False Indicate whether the statement is true or false
Suppose that the marginal cost of producing cottonseed meal is $170 per ton. If the cottonseed oil industry is perfectly competitive and in long-run equilibrium, the average total cost of producing cottonseed oil:
A. is equal to $170 per ton. B. is greater than $170 per ton. C. is less than $170 per ton. D. cannot be determined.
Answer the following statement true (T) or false (F)
1) The efficiency loss of a tax is the tax revenue collected by government minus the value of the public goods financed through the tax. 2) The greater the elasticity of demand and supply, the greater is the efficiency loss of a tax. 3) Economists agree that corporations always shift the corporate income tax to consumers by raising product prices. 4) Although state and local taxes are highly progressive, federal taxation is predominantly