If a college degree is used to signal high ability, but the cost of a college degree is relatively high,
A) a separating equilibrium is achieved.
B) a pooling equilibrium is achieved.
C) even low-ability workers will attend college.
D) the share of high-ability workers must be 1.
B
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Marginal utility theory concludes that a decrease in the price of a good increases the quantity demanded and
A) increases the demand for substitutes. B) decreases the demand for complements. C) increases the total expenditure on the good. D) increases total utility.
Using the figure as a guide, which of the following is FALSE with respect to profit maximization and the monopolist?
A) A monopolist (like any other firm) will select an output rate at which marginal revenue is equal to marginal cost, at the intersection of the marginal revenue curve and the marginal cost curve. B) The monopolist will produce quantity Qm and charge a price of Pm. C) When compared to a competitive situation, consumers pay a higher price to the monopolist, and consequently are forced to purchase more of a product as price varies directly with quantity demanded. D) Profits are the positive difference between total revenues and total costs.
The aggregate production function relates total national output to:
A. inputs and outputs. B. inputs and technology. C. employment and growth. D. the production possibilities frontier. E. inflation and economic growth.
If resource prices are "sticky" downward and a recessionary gap develops in an economy, the short-run aggregate supply curve will _____
Fill in the blank(s) with the appropriate word(s).