The input-substitution effect associated with an increase in the wage implies that as the wage increases, a firm will substitute other inputs for the relatively expensive labor.
Answer the following statement true (T) or false (F)
True
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Refer to Exhibit 11-4. If a person’s taxable income is $30,000, how much does he pay in taxes?
A. $4,850 B. $1,400 C. $3,900 D. $4,345
Laurel and Janet are competitors in a local market and each is trying to decide if it is worthwhile to advertise. If both of them advertise, each will earn a profit of $5,000 . If neither of them advertise, each will earn a profit of $10,000 . If one advertises and the other doesn't, then the one who advertises will earn a profit of $12,000 and the other will earn $2,000 . In this version of the
prisoners' dilemma, if the game is played only once, Laurel should a. advertise, but if the game is to be repeated many times she should probably not advertise. b. advertise, and if the game is to be repeated many times she should still probably advertise. c. not advertise, but if the game is to be repeated many times she should probably advertise. d. not advertise, and if the game is to be repeated many times she should still not advertise.
If a product has only a few acceptable substitutes, demand for the product is most likely to be:
A. very inelastic. B. inelastic. C. elastic. D. very elastic.
The cost of hiring one more worker, ceteris paribus, is known as
A. marginal wage. B. marginal revenue product. C. marginal physical product. D. marginal factor cost.