Refer to the following graph. The price of capital (r) is $20.
Why wouldn't the firm choose to produce 5,000 units of output with the combination at A?
A. At A, MPK / r > MPL / w.
B. At A, MRTS < 3/2.
C. At A, MPL > MPK.
D. both a and b
E. none of the above
Answer: E
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Refer to Table 1-2. What is Thuy Anh's marginal benefit if she decides to stay open for an extra three hours instead of two hours?
A) $0 B) $20 C) $25 D) $45 E) $70
A legal restriction on the amount of a good that can be imported into a country is known as a
A) voluntary restraint agreement. B) tariff. C) quota. D) Domestic Protection Restraint (DPR).
Knowing the value of the cross elasticity of demand allows us to distinguish between inferior goods and normal goods.
Answer the following statement true (T) or false (F)
Improved technology has reduced the risk of grain loss during storage. If wheat farmers expect wheat prices to rise substantially in about four months from now, which of the following is likely to be true?
a. The current supply of wheat will decline, as farmers store wheat in anticipation of the higher prices. b. The price of wheat breads is likely to decline in the future. c. The expectation of higher prices in the future is unlikely to have any impact on current wheat supply. d. The supply of wheat is likely to increase immediately.