Bob and Bill can make 16 toys each if they devote 8 working hours in a day. Further, Bob can repair 4 cars and Bill can repair 2 cars, if they devote 8 working hours in a day. What is the opportunity cost of repairing one car to Bill?
a. 10 toys
b. 8 toys
c. 16 toys
d. 12 toys
e. 4 toys
b
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If the Fed raises the interest rate, in the foreign exchange market the demand for the U.S. dollar increases
Indicate whether the statement is true or false
Suppose a firm's short-run production function is given by Q = F(L) = 4L. If the wage rate is $12 and the firm has sunk costs of $300, then the firm's cost function is:
A. C(Q) = $12L. B. C(L) = $300 + $3L. C. C(Q) = $300 + $3Q. D. C(Q) = $300 + $12Q.
Resource prices that are fixed by long-term contracts help explain why, in the short run, firms will
a. increase output when product prices increase. b. keep production levels constant when product prices decrease. c. keep their product prices constant even if the demand for their good increases. d. keep their product prices constant even if the demand for their good decreases.
Which of the following concepts cannot be illustrated by the production possibilities frontier?
a. efficiency b. opportunity cost c. equality d. trade-offs