We limit ourselves to two periods in the intertemporal model of the business cycle because
A) we need to concentrate on the two phases of the business cycle.
B) we can assume that people can live two periods of, say, 30 years.
C) this is all we need to emphasize the intertemporal trade-off.
D) we need an even number of periods.
C
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Refer to the following graph. Which of the following statements is true?
a. The vertical difference between the ATC curve and the AVC curve at any output level equals AFC.
b. Total fixed cost at any output level equals the difference between ATC and AVC.
c. Whenever the MC curve lies below the ATC or AVC curves then ATC and AVC are rising.
d. The AFC curves slopes downward for as long as MC is falling but rises when MC rises.
The accompanying table below shows how total donations, average donations, total labor costs and average labor costs vary depending on the number of employees State U hires for its fundraising activities. Number of EmployeesTotal DonationsAverage DonationsTotal Labor CostsAverage Labor Costs1$30,000 $8,0002$42,426 $17,000 3 $17,321$27,000 4$60,000 $9,5005 $13,416$50,000 The President of State U decides to hire fundraising employees as long as their average benefit exceeds their average cost. This results in ________ employees being hired and a net benefit (total donations minus total labor costs) of ________.
A. 4; $60,000 B. 5; $67,080 C. 4; $22,000 D. 5; $17,080
The general resistance to change, often stemming from loss aversion, is known as:
A. the present aim standard of rationality. B. the Weber-Fechner law. C. regression to the mean. D. status quo bias.
There is lack of strong incentives in a monopoly industry, relative to a competitive industry to
A. Use minimum average cost pricing. B. Increase innovation. C. Inhibit productivity advances. D. Lower prices and increase output.