What is the overall longrun impact of labor immigration on returns to factors of production?
a. Returns to labor will increase and returns to capital will decrease.
b. Returns to labor and returns to capital will both increase.
c. Both relative and absolute returns to factors of production will not change.
d. Both relative and absolute returns to factors of production will increase.
Answer: c. Both relative and absolute returns to factors of production will not change.
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Refer to the table below. Suppose the profit for each unit of paper product is $2 and the profit for each unit of lumber is $5 and Big Oaks is producing the profit-maximizing quantity of lumber and paper products. If the profit from each unit of lumber increases from $5 to $6 and the profit for each unit of paper products does not change, to maximize profit, Big Oaks should produce a ________
proportion of lumber and produce ________ units of paper products and lumber.
Big Oaks can produce either paper products or lumber with each tree that they harvest. Because Big Oaks can adjust the amount of paper products and lumber they produce from the harvested trees, paper products and lumber are produced in variable proportions. The above table summarizes Big Oaks production possibilities from each harvested tree.
A) smaller; more
B) smaller; less
C) greater; less
D) greater; more
If a monopolist produces to a point at which marginal revenue is greater than marginal cost then
A) profits are being maximized. B) profits will always be negative. C) the incremental cost of producing the last unit exceeds the incremental revenue. D) the incremental cost of producing the last unit is less than the incremental revenue.
Potential GDP is an estimate of the economy's ability to produce goods and services if the
a. labor force is fully employed. b. price level is stable. c. trade balance is zero. d. federal budget is balanced.
A merger between the Ford Motor Company and the Firestone Tire Company would be a ________ merger.
A. horizontal B. vertical C. conglomerate D. diversifying