Assume that a restaurant is hiring labor in an amount such that the MRC of the last worker is $16 and her MRP is $12. Based on this information, we can say that
A. profits will be increased by hiring additional workers.
B. profits will be increased by hiring fewer workers.
C. the restaurant is maximizing profits.
D. marginal revenue product must exceed average revenue product.
Answer: B
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Based on the data in Table 3.1, if Jesse and April choose to specialize and trade, then
A) April will specialize in painting snowboards and trade snowboards for kites. B) Jesse will specialize in painting snowboards and trade snowboards for kites. C) April will specialize in painting kites and trade kites for snowboards. D) None of the above; specialization and trade are not beneficial for Jesse and April.
Refer to Table 4-3. The table above lists the marginal cost of polo shirts by Marko's, a firm that specializes in producing men's clothing. If the market price of Marko's polo shirts is $30, Marko's will produce
A) 0 shirts. B) 1 shirt. C) 3 shirts. D) 4 shirts.
Bob goes to his favorite hot dog stand, which is offering one hot dog for $2.50 or two for $4.00. Bob’s marginal cost of a second hot dog is
A. $1.00. B. $2.00. C. $1.50. D. $2.50.
The ability of increasing quantity supplied in response to a higher price is identical across industries
a. True b. False