If a firm's sales are $16 million, its fixed costs $18 million, and its variable costs $15 million, what does it do in the (a) short run? (b) long run?
What will be an ideal response?
(a) operate; (b) go out of business
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Other things equal, assume consumer demand for children's toys increases. The result is a(n):
a. rightward shift in the market demand for labor curve in the toy industry. b. increase in the marginal revenue product of firms in the toy industry. c. increase in derived demand for workers in the toy industry. d. all of these.
Robert needs to raise $100,000 to pay for an operation that will save his wife's life. The only way he can raise the money is to sell one of his kidneys to a wealthy man in need of a kidney transplant. This is an example of a trade that:
A. may benefit each party but may not be permitted in a society that believes selling body parts is morally wrong. B. would never be permitted in any society. C. may benefit each party but cannot be considered efficient. D. should be permitted as long as each party enters into the agreement voluntarily.
Microeconomics is concerned with the study of
A. the effects of government spending. B. aggregates. C. the effects of inflation. D. the effects on individual producers of higher wages paid to workers.
Over the range of positive, but diminishing, marginal returns for an input, the total product curve:
A. Falls B. Rises at a constant rate C. Rises at a decreasing rate D. Rises at an increasing rate