A profit-maximizing company should extract a nonrenewable resource in the present up to the quantity where the:
A. selling price of the resource equals the extraction cost plus the user cost of the resource.
B. selling price of the resource equals the total cost plus the user cost of the resource.
C. selling price of the resource equals the extraction cost of the resource.
D. extraction cost of the resource equals the user cost of the resource.
Answer: A
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Governments of market-oriented economies never tamper with the price mechanism.
Answer the following statement true (T) or false (F)
The Keynesian model is based on the idea that
A) both consumption and saving are directly related to disposable income. B) saving depends only on the interest rate. C) consumption is unrelated to the level of real Gross Domestic Product (GDP). D) both consumption and saving are unrelated to the level of real Gross Domestic Product (GDP).
The Keynesian range of the aggregate supply curve is the portion where:
a. The average price level and real GDP do not change with movements in aggregate demand. b. Real GDP does not change with movements of aggregate demand, but the average price level does change. c. The average price level does not change with movements of aggregate demand, but real GDP does. d. The average price level and real GDP change with movements in aggregate demand.
A U.S. firm that outsources jobs would be
A. Buying raw materials from a Chinese firm instead of a U.S. firm. B. Buying computers assembled in Mexico that used U.S. parts. C. Building a factory in Canada and hiring Canadian workers. D. All of the choices are correct.