One reason that college graduates earn higher wages than non-graduates is because college graduates:
A. acquire additional skills to allow them to work in more industries than non-graduates.
B. always work in more dangerous jobs than non-graduates.
C. are always more intelligent than non-graduates.
D. are less equipped to deal with technological change, as their skills are technology-specific.
Answer: A
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A cellphone maker sells 6,000 units per month at $600 each. The firm is investigating whether a price cut to $500 is warranted. The firm’s marginal cost of production of each phone is a constant $400 per unit. To maintain profits at their current level, quantity sold must increase to at least
A. 8,000 B. 10,000 C. 12,000 D. 15,000
After the American Civil War, many prominent Southerners lamented the fact that the South "overproduced" cotton and "underproduced" food. In fact, the South did import a very large percentage of its food. Nevertheless, rather than reduce cotton production and grow more food, Southern farmers did the opposite because
a. they were irrational and distraught over the loss of slavery. b. the South had a comparative advantage in cotton production. c. the North had a comparative advantage in cotton production. d. corn was absolutely cheaper to produce in the North.
Which of the following is true for a purely competitive firm in short-run equilibrium?
A. The firm is making only normal profits B. The firm's marginal cost is greater than its marginal revenue C. The firm's marginal revenue is equal to its marginal cost D. A decrease in output would lead to a rise in profits
When compared with the purely competitive industry with identical costs of production, a monopolist will produce:
A. More output and charge the same price B. More output and charge a higher price C. Less output and charge a higher price D. Less output and charge the same price