In the above figure, if the wage rate fell below Wb, in the short run the firm would
A) hire more workers.
B) fire several workers.
C) reduce its level of output.
D) keep all its input levels the same as they were before.
A
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If a product is narrowly defined, it is likely to
A) have many substitutes and therefore its demand is elastic. B) have few substitutes, and therefore its demand is less elastic. C) be unique, and therefore its demand is inelastic. D) be unique and have many substitutes. E) have a larger proportion of income spent on it.
The only goods you consume are pizza and soda. Both are normal goods. You consider pizza and soda to be substitutes. Which of the following will lead you to eat more pizza?
A) The price of a pizza falls. B) The price of a soda falls. C) The price of a soda rises. D) Both answers A and C are correct.
Economists working at federal government agencies have estimated that the marginal social cost of carbon is about
A) $2 per ton. B) $9 per ton. C) $21 per ton. D) $47 per ton.
In the 2-factor, 2 good Heckscher-Ohlin model, the two countries differ in
A) tastes and preferences. B) military capabilities. C) the size of their economies. D) relative abundance of factors of production. E) labor productivities.