The following graph shows the marginal and average product curves for labor, the firm's only variable input. The monthly wage for labor is $2,800. Fixed cost is $160,000.
When the firm uses 120 units of labor, how much output does it produce?
A. 7,500 units
B. 7,000 units
C. 70 units
D. 8,400 units
E. 9,200 units
Answer: D
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What weakness in the economic structures of Asian countries contributed to the severe financial crisis that Asian economies experienced in 1997?
A) Productivity: It increased rapidly and the countries were victims of their own success B) Banking regulation: Banks were excessively regulated, which reduced profits. C) Legal Framework: The system dealt unsuccessfully with companies in financial trouble D) Natural Resources: Countries' lack of natural resources and failure to explore developing industries accumulated and led to the crisis. E) High Taxes: High rates of taxation resulted in a reliance on imports.
When there is a tendency for a particular product to fall out favor with additional consumers because other consumers have chosen not to purchase the product
A) negative market feedback occurs. B) positive market feedback occurs. C) the tit-for-tat strategy will begin. D) the network effect will increase.
If people took external costs like pollution into consideration:
A. they would consume less of the goods causing these externalities. B. they would act in a way that is optimal from a societal perspective C. the markets for these goods creating such externalities would generate greater surplus. D. All of these statements are true.
Suppose that the money supply increases. In the short run this decreases unemployment according to
a. both the short-run Phillips curve and the aggregate demand and aggregate supply model. b. neither the short-run Phillips curve nor the aggregate demand and aggregate supply model. c. the short-run Phillips curve, but not according to the aggregate demand and supply model. d. the aggregate demand and aggregate supply model, but not according to the short-run Phillips curve.