A country has a comparative advantage in producing a good if it is relatively more efficient at making it.
a. true
b. false
Answer: a. true
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If the marginal product of a worker is 10 units and each unit of the good is sold for $5, the value of marginal product of the worker is:
A) $2. B) $5. C) $10. D) $50.
Which of the following activities will generate a negative externality?
a. A beekeeper keeping bees for honey b. Inoculations for communicable diseases c. Research and development activities of a firm d. A chemical factory set up in a residential area e. Improvement in education facilities
Along its long-run average total cost curve, a firm employs
a. a different amount of fixed inputs at each point b. the same amount of fixed inputs at each point c. a declining amount of fixed inputs at each point as it moves to higher output levels d. an increasing amount of fixed inputs at each point as it moves to higher output levels e. no fixed inputs
Suppose that the labor market for life guards is initially in equilibrium. Then swimming pool owners adopt a new labor-saving technology that uses computers to monitor the locations of swimmers in the pool. What happens to the equilibrium wage and quantity of life guards?
a. Both the equilibrium wage and quantity increase. b. Both the equilibrium wage and quantity decrease. c. The equilibrium wage increases, and the equilibrium quantity decreases. d. The equilibrium wage decreases, and the equilibrium quantity increases.