An increase in long-run average costs resulting from decreases in output is
A) attributed to the law of diminishing marginal product.
B) attributed to constant returns to scale.
C) attributed to economies of scale.
D) attributed to diseconomies to scale.
Answer: C
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If the government raises income taxes, then the labor
A) supply curve shifts rightward. B) demand curve shifts leftward. C) demand curve shifts rightward. D) supply curve shifts leftward. E) Both answers B and D are correct.
Does the principle of optimization imply that people always make the best choices?
What will be an ideal response?
Income assistance programs
a. require that the recipient work and contribute to the program b. are designed to replace lost income c. include unemployment compensation and Medicare d. are funded exclusively by the federal government e. include both cash and in-kind transfer programs
Compared to a perfectly competitive industry, a monopolist with the same marginal cost and demand curve will charge:
a. a higher price and produce a higher volume of output. b. a lower price and produce a higher volume of output. c. a lower price and produce a lower volume of output. d. a higher price and produce a lower volume of output. e. the same price and produce the same volume of output.