Governments grant patents to encourage
A) research and development on new products.
B) competition.
C) low prices.
D) firms to form public enterprises.
Answer: A
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Which of the following statements correctly identifies a difference between labor and capital?
A) Capital can be rented or owned by a firm, but labor cannot be owned. B) Labor can be rented or owned by a firm, but capital cannot be owned. C) Labor is hired until a point where the marginal product of labor equals the price of labor, whereas capital is hired until a point where the average product of capital equals the price of capital. D) Labor is hired until a point where the average product of labor equals the price of labor, whereas capital is hired until a point where the marginal product of capital equals the price of capital.
From the viewpoint of the individual investor, are stocks or bonds riskier? Explain.
What will be an ideal response?
The price elasticity of demand coefficient for a good will be lower:
a. if there are few substitutes for the good. b. if expenditure on it is a small part of one's budget. c. both a and b are true. d. neither a nor b are true.
Which of the following statements is true about the total utility provided by a good?
a. Total utility can never be negative. b. Total utility is maximized when marginal utility is maximized. c. Total utility continues to increase as more of the good is consumed. d. Total utility is maximized when marginal utility is zero (for total utility > 0). e. Total utility is maximized when marginal utility is zero (for total utility < 0).