In the above figure, at the profit-maximizing rate of production for the perfectly competitive firm, total revenue is
A. $130.
B. $70.
C. $100.
D. $30.
Answer: C
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Suppose that technological advancement makes labor more productive. What is likely to happen to wages and to potential output?
A) Wages decrease and potential output increases. B) Wages decrease and potential output decreases. C) Wages increase and potential output increases. D) Wages increase and potential output decreases.
The marginal productivity theory of income distribution states that
A) income distribution is determined by the marginal productivity of the factors of production that individuals own. B) as more and more units of labor are added to a fixed quantity of capital, eventually labor's contribution to a firm's income will decrease. C) factors of production in short supply command higher prices than those available in abundant quantities. D) capital owners receive the bulk of a nation's income because capital-intensive production generates productivity gains.
If the number two and number three firms in an industry with 10 firms merge, what happens to that industry's concentration ratio?
A. It rises B. It falls C. It remains the same D. There is not enough information to determine whether it rises, falls, or remains the same.
In a monopoly, the market demand curve is
A. nonexistent. B. the same as the demand curve facing the firm. C. the summation of all the individual firm's cost curves. D. the marginal cost curve above minimum average variable cost.