The cost of two inputs A and B are $100 and $200 per unit per month. A firm can afford to invest $10,000 per month on these inputs. The firm uses 30 units of A. Given a linear isocost such that the entire budget is exhausted, the firm will use 10 units of B
Indicate whether the statement is true or false
F
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Suppose that a firm can invest $100 today in a project and receive $105 a year from today. There is no inflation, and the annual interest rate in the economy is 6%. The firm should
A) invest in the project because the opportunity cost is greater than the return on the investment. B) not invest in the project because the opportunity cost is greater than the return on the investment. C) invest in the project because the opportunity cost is less than the return on the investment. D) invest in the project because the opportunity cost is the same as the return on the investment.
In an "underground economy," the production of goods and services
A) is usually too insignificant to be included in GDP. B) is not measured but is included in GDP. C) is measured and included in GDP. D) is not measured or included in GDP.
All of the following are criteria used to select a forecasting technique EXCEPT:
a. the accuracy required of the forecasting model b. the time required to complete the model c. the complexity of the relationships being forecast d. the cost associated with developing the forecasting model e. all of these are criteria used to select a forecasting technique
Starting from a pure exchange equilibrium, an increase in the demand for a commodity will result in:
a. a fall in the market price. b. a rise in the market price. c. a rise in the equilibrium output. d. a fall in the equilibrium output.