If the value of your marginal product is 100 and you are being paid 80, which of the following is the most plausible reason that you remain with the firm?
A. You have no other options so you stay or go unemployed.
B. You are altruistic and want to contribute to the firm's normal profit.
C. You have no way of knowing the value of your marginal product so you feel OK about the salary of 80.
D. You value the high rank and leadership role as well as the salary that your position offers.
Answer: D
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Rational utility maximizing consumers tend to:
A. choose the same bundle of goods regardless of their income. B. change their consumption choices when either prices or income changes. C. buy the same bundle of goods regardless of the prices charged. D. change their consumption choices only when both prices and income changes simultaneously.
Which of the following statements best describes an effect of tax cuts?
a. In a recession, when the intersection of the AD and AS curves is far below the full-employment level, tax cuts can do not make sense as a way of shifting AD to the left. b. In a recession, when the intersection of the AD and AS curves is far below the full-employment level, tax cuts do not make sense as a way of shifting AD to the right. c. In a recession, when the intersection of the AD and AS curves is far below the full-employment level, tax cuts can make sense as a way of shifting AD to the left. d. In a recession, when the intersection of the AD and AS curves is far below the full-employment level, tax cuts can make sense as a way of shifting AD to the right.
Suppose a basket of goods and services has been selected to calculate the CPI and 2012 has been selected as the base year. In 2012, the basket's cost was $50; in 2014, the basket's cost was $52; and in 2016, the basket's cost was $55 . The value of the CPI in 2016 was
a. 90.9. b. 104.0. c. 105.0. d. 110.0.
A price-discriminating monopolist will charge a higher price to individuals whose demand is:
A. more elastic. B. more inelastic. C. unit elastic. D. unit inelastic.