Economic growth can be drawn in a diagram by
A) making the production possibilities curve more bowed out.
B) making the production possibilities curve less bowed out.
C) shifting the production possibilities curve out.
D) shifting the production possibilities curve in.
Answer: C
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Answer the following statement(s) true (T) or false (F)
1. In a model that analyzes the effects of a tax change, the tax serves as an endogenous variable. 2. The embarrassment theory suggests why shopping carts should be smaller. 3. An economic model, even if unrealistic, is useful as long as it makes predictions that are realistic. 4. Efficiency is the only criterion by which economists judge policies. 5. All points on a risk-neutral individual's indifference curve have the same expected value.
Why would candy companies in the United States dislike the U.S. trade barriers on imported sugar?
a. Barriers decrease the cost of production, making candy less expensive. b. Barriers decrease the cost of production, making candy more expensive. c. Barriers increase the cost of production, making candy more expensive. d. Barriers increase the cost of production, making candy less expensive.
Figure 11-7
The firm in Figure 11-7 is an unregulated monopolist; it will earn long-run profits of how much?
A. 500 B. 400 C. 300 D. 200
Sunshine's Organic Market sells organic produce. Assume that labor is the only input that varies for the firm. The store manager has determined that if she hires 5 workers, the store can sell 150 pounds of produce per day. If she hires 6 workers, the store can sell 170 pounds of produce per day. The store earns $4 for each pound of produce that it sells, and the manager pays each worker $60 per
day. Which of the following is not correct? a. For the 6th worker, the marginal product is 20 pounds of produce per day. b. For the 6th worker, the marginal revenue product is $20 per day. c. The store earns a higher profit by employing 6 workers than by employing 5 workers. d. Assuming no changes in either the daily wages paid to store workers or the price at which the store sells its produce, the firm would maximize profits by hiring a 7th worker so long as the store can increase its sales to at least 185 pounds per day.