A profit-maximizing firm will employ labor up to the point where MRP = wage
Indicate whether the statement is true or false
T
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The principle of comparative advantage explains specialization and trade among countries but not among individuals.
Answer the following statement true (T) or false (F)
Refer to Figure 7.1. If Angus chooses to earn the most money and Dudley does nothing, Dudley will receive a daily payoff of
A) $100. B) $350. C) $550. D) $700.
Which of the following could be evidence of a market failure?
A) There are only a handful of firms competing against each other in an industry. B) The market price of a product is above the average cost of production. C) Resources in an economy are not fully utilized. D) Market prices do not reflect true production costs.
The cost of production on the “bottom forty” is $100,000 for a given size crop. On the “north forty,” due to erosion of the soil, the cost is $150,000. If both are being farmed by tenants, we would expect the rent on the “bottom forty” to be
A. $50,000 below the rent on the north forty. B. $50,000 above the rent on the north forty. C. different from that on the north forty by an indeterminable amount. D. $50,000, and the rent on the north forty is $50,000.