In a perfectly competitive labor market, the least-cost combination rule for resource use
A. requires that the marginal physical product per dollar spent for each resource is equalized.
B. assures the firm a normal profit.
C. assures the firm an economic profit.
D. requires that resources be used in combinations such that marginal products are equal.
Answer: A
You might also like to view...
Countries with high rates of economic growth tend to have
A) a lower life expectancy at birth. B) low rates of technological advancement. C) a declining incidence of business cycle fluctuations. D) a labor force that is more productive.
Which of these policy targets does NOT provide a "nominal anchor?"
A) high-powered money B) the unemployment rate C) the money supply D) the inflation rate
Under perfect competition, if an industry is characterized by positive economic profits in the short run:
a. firms will leave the market in the long run and the short-run supply curve will shift outward. b. firms will enter the market in the long run and the short-run supply curve will shift outward. c. firms will enter the market in the long run and the short-run supply curve will shift inward. d. firms will leave the market in the long run and the short-run supply curve will shift inward.
Contractionary fiscal policy is enacted when the overall effect of decisions about taxation and spending is to:
A. reduce aggregate demand. B. increase aggregate demand. C. reduce aggregate supply. D. increase aggregate supply.