Based on data from the U.S. economy, the marginal propensity to consume is about
A) 0.95. B) 0.75. C) 0.60. D) 1.10. E) 0.87.
E
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Miniville is an isolated town located on the southern shore of Lake Condescending, a very large lake. The western edge of Miniville is adjacent to impassable mountains and there are no towns or businesses for many miles to the east. The 300 residents of Miniville are evenly distributed along 3 miles of shoreline on the lake, east of the mountains. Lake Shore Drive, the only street in town, provides access to Miniville's homes and businesses. All residents live between the lake and the street; businesses locate on the other side of the street. Lake Shore Drive is 3 miles long, and the points labeled A, B, and C are 1, 2, and 3 miles from the western end of Lake Shore Drive, respectively. All residents of Miniville shop at the store located closest to their homes. src="https://sciemce.com/media/4/ppg__rrr0818190951__f1q364g1.jpg" alt="" style="vertical-align: 0.0px;" height="117" width="538" />If three stores were to open sequentially, you would expect that those stores would be located:
A. in a cluster, nearest the mountains.
B. at points A, B, and C.
C. in a cluster, near the location chosen by the first store to locate.
D. halfway between the mountains and A, halfway between A and B, and halfway between B and C.
Assuming that the demand for a good has increased and the supply of a good has decreased by the same amount, then: a. The change in price is determinate but the change in quantity is indeterminate. b. The change in quantity is determinate but the change in price is indeterminate. c. Both the change in price and the change in quantity will be indeterminate
d. Neither the change in price nor the change in quantity will be indeterminate.
An increase in the price of good X due to a reduction in its supply will: a. increase the total revenue of good X
b. decrease the total revenue of good X. c. increase the total revenue of goods that are substitutes for X. d. increase the total revenue of goods that are complements for X.
Assume fixed costs are 470 and labor costs $20 per unit. The first laborer produces 20 units of output. Subsequent hires add 5 units less to production than the previous worker. Thus the second worker adds 15, the third adds 10 etc. What is the average variable cost of output when one worker is hired?
A. 20 B. 24.50 C. 1 D. None of these is the correct AVC.