For a firm that uses land, labor and capital as inputs, how should the inputs be utilized in order to minimize total costs?
What will be an ideal response?
Given a particular rate of production, the firm can minimize total costs by hiring each of the three inputs up to the point at which the marginal physical product per last dollar spent on each input is equalized across the three inputs.
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The market demand for wheat is Q = 100 - 2p + 1pb, where pb is the price of barley. If the price of wheat is $2, the price elasticity of demand
A) equals (-4/46). B) equals (-46). C) equals (-1). D) cannot be calculated without more information.
Suppose two Cournot duopolist firms operate at zero marginal cost. The market demand is p = a - bQ. Each firm will produce
A) a/b. B) a/2b. C) a/3b. D) a/4b.
The law of diminishing marginal utility states that as you consume more and more of a good, other things constant,
a. total utility eventually rises b. marginal utility can become positive c. marginal utility approaches, but never becomes, zero d. total utility can never become negative e. marginal utility eventually declines
Refer to the information provided in Table 23.1 below to answer the question(s) that follow. Table 23.1
Refer to Table 23.1. Assuming society's MPC is constant at an aggregate of income of $300, aggregate consumption would be
A. $425. B. $350. C. $325. D. $305.