Where should a producer stop devoting more of his spending on labor if initially the MRP of the additional dollar spent on labor is higher than the MRP of the additional unit spent on tools?
A. MRP/$ of additional labor falls below MRP/$ of additional tools.
B. MRP/$ of additional capital increases above MRP/$ of additional tools.
C. MRP/$ of additional labor becomes equal to MRP/$ of additional tools.
D. MRP/$ of the additional labor falls to zero.
Answer: C
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Which of the following would not be considered an automatic stabilizer?
A. Defense spending B. Income tax C. Welfare payments D. Unemployment compensation
Refer to the scenario above. What is the net present value of the investment?
A) -$7,112.36 B) -$5,365.10 C) -$475.31 D) $9,524.19
Suppose that you have just read a review of the literature of the effect of beauty on earnings
You were initially surprised to find a mild effect of beauty even on teaching evaluations at colleges. Intrigued by this effect, you consider explanations as to why more attractive individuals receive higher salaries. One of the possibilities you consider is that beauty may be a marker of performance/productivity. As a result, you set out to test whether or not more attractive individuals receive higher grades (cumulative GPA) at college. You happen to have access to individuals at two highly selective liberal arts colleges nearby. One of these specializes in Economics and Government and incoming students have an average SAT of 2,100; the other is known for its engineering program and has an incoming SAT average of 2,200. Conducting a survey, where you offer students a small incentive to answer a few questions regarding their academic performance, and taking a picture of these individuals, you establish that there is no relationship between grades and beauty. Write a short essay using some of the concepts of internal and external validity to determine if these results are likely to apply to universities in general. What will be an ideal response?
Consumer surplus increases as
a. the market price of a good decreases b. firms exit the market c. fewer consumers purchase a good d. taxes on a good increase e. a good is no longer available for sale