Exhibit 10-4 Supply and demand curves for food servers
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If the equilibrium wage rate in Exhibit 10-4 increased, the cause could be that:
A. the wage increased.
B. the marginal product of labor decreased.
C. either the demand for labor increased or the supply of labor decreased.
D. the price of the product produced by the labor decreased.
Answer: C
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"The Florida freeze has destroyed 40% of the orange cro
A) Yes. The freeze would not reduce the supply. B) Yes. The higher price would not reduce the demand. C) Yes. It assumes the demand curve for oranges is vertical. D) Yes. It assumes the demand curve for oranges is upward-sloping.
Cindy discovers that when she goes to the beach, she does not have to bring her radio. She can put her blanket near someone who has a radio and listen all day (without having to carry her radio, get sand in her speakers, or buy new batteries). This is an example of:
a. private property abuse. b. external costs. c. a negative externality. d. a positive externality.
The price of a loaf of bread is $1.50, the price of a gallon of milk is $3.00, and the price of a pound of butter is $2.40. The price of a loaf of bread relative to a gallon of milk is ________, while the price of a gallon of milk relative to a pound of butter is ________.
A. 2.0; 0.8. B. 0.5; 1.25. C. 0.5; 0.8. D. 2.0; 1.25.
An industry has five firms, each with a market share of 20 percent. There is no foreign competition, entry into the industry is difficult, and no firm is on the verge of bankruptcy. If two of the firms in the industry seek to merge, this action would most likely be opposed by the government because the Herfindahl index for the industry is:
A. 2000 and the merger would increase the index by 500 B. 2000 and the merger would increase the index by 800 C. 2500 and the merger would increase the index by 500 D. 2500 and the merger would increase the index by 1200