The source of the benefits of the division of labor is
A. the efficiency that results from workers specializing in one aspect of production.
B. that when each worker is equally capable, each worker adds to production exactly the same as the previous one.
C. the fact that anytime you increase labor you get more output.
D. the inefficiency that results from the fact that capital is fixed.
Answer: A
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How can the Gordon Growth model help explain the major decline in stock indexes during 2007-2009?
A) There was an increase in the required return on equities and a decrease in the expected growth rate of dividends. B) There was a decrease in the required return on equities and an increase in the expected growth rate of dividends. C) There was an increase in the required return on equities and an increase in the expected growth rate of dividends. D) There was a decrease in the required return on equities and a decrease in the expected growth rate of dividends.
Assume that a firm's marginal revenue just barely exceeds marginal cost. Under these conditions the firm should:
a. expand output. b. contract output. c. maintain output. d. There is insufficient information to answer the question.
Which of the following will occur if the supply curve for gasoline shifts to the left?
A. Nothing will happen to the quantity of gasoline used because people are addicted to gasoline. B. The demand for gasoline will shift to the left as people demand less gasoline. C. The price of gasoline will fall, and the quantity demanded will rise. D. The price of gasoline will rise, and the quantity demanded will fall.
The excess burden of a tax is $5,000 and the tax revenue from this tax is $20,000. The total burden of this tax is
A. $4,000. B. $5,000. C. $15,000. D. $25,000.