A look at Big Mac prices around the world shows that purchasing power parity
A. holds for less developed countries.
B. holds for developed countries.
C. holds.
D. does not hold.
Answer: D
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Since the marginal product of labor equals the change in the quantity of output divided by the change in the quantity of labor, it stands to reason that:
a. a firm would never operate in the range where marginal product is negative. b. a firm would never operate in the range where marginal product is decreasing. c. marginal product will continually increase as the firm produces more. d. there is no predictable relationship between marginal revenue and marginal cost.
A jury ordered McDonald's to pay $2.7 million to Stella Liebeck, a drive-through customer who burned herself with hot coffee after placing the cup between her legs to remove the top and add cream. She claimed that the coffee was too hot. This tells us that our legal system can:
A. lower costs by creating incentives to litigate frivolous suits. B. promote efficiency by lowering transaction costs. C. promote efficiency by making property rights secure. D. raise costs by creating incentives to litigate frivolous suits.
According to your textbook, which procedure is the general rule to follow in order to maximize net revenue?
A) Always choose a 25 percent markup if demand is inelastic. B) Always choose a 25 percent markup if demand is elastic. C) Always choose a markup between 50 and 100 percent (inclusively) if demand in inelastic. D) Always choose no more than a 10 percent markup if demand is perfectly elastic. E) None of the above.
In 2011, total output of goods and services in the United States was approximately
a. $10 trillion. b. $12 trillion. c. $15 trillion. d. $20 trillion.