If you mow the lawn yourself, the lawn mowing is considered household production. If you pay Larry's Lawn Service to mow your lawn, the lawn mowing is considered
A) a leisure time activity.
B) a service, that will be counted as part of GDP.
C) a service, but is not counted as part of GDP because it simply replaces a service you used to perform.
D) rent, and therefore is counted as part of GDP.
E) underground production because it replaces the underground production of you mowing your lawn.
B
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The figure above shows a perfectly competitive firm. If the market price is $20 per unit, then the firm produces ________ units and makes an economic profit that is ________
A) more than 30; more than $100 B) 30; more than $100 C) 20; less than $400 D) 0; zero E) 30; zero
As the amount of time a consumer has to adjust to a change in price increases, so does the price elasticity of demand for a good
Indicate whether the statement is true or false
All of the following are characteristics of a perfectly competitive market except:
A) a large number of sellers. B) perfectly elastic demand. C) a homogeneous product. D) barriers to entry.
Ajax has just discovered that the marginal revenue product generated by the last worker hired was $125 while the marginal factor cost was $85. What should Ajax do?
A) Leave the level of production unchanged. B) Increase the amount produced. C) Reduce the amount produced. D) Collect more information before making a decision.