Suppose Sarah owns a small company that makes wedding cakes. The table below shows how Sarah's total cost varies depending on the number of wedding cakes she makes each day.Number ofCakes Per DayTotal CostPer Day0$1001$1802$2203$3004$4005$5206$660If the market for wedding cakes is perfectly competitive, and wedding cakes sell for $95 each, then Sarah should produce ________ cakes per day.
A. 6
B. 3
C. 5
D. 0
Answer: B
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Explain using price elasticity of demand why air conditioning manufacturers would actually have sales in the middle of the summer when customers have the most acute need? Explain this apparent paradox
What will be an ideal response?
If the government is supplying a public good, the efficient quantity is where the:
A. total social benefit equals the cost. B. marginal social benefit is greater than the cost. C. marginal social benefit equals the cost. D. total social benefit outweighs the total cost.
Suppose that production for good X is characterized by the following production function, Q = K0.5L0.5, where K is the fixed input in the short run. If the per-unit rental rate of capital, r, is $25 and the per-unit wage, w, is $15, then the average fixed cost of using 81 units of capital and 9 units of labor is:
A. $75. B. $80. C. $5. D. There is insufficient information to determine the average fixed costs.
Members of the Board of Governors of the Federal Reserve System are
A. elected by member banks to serve four-year terms. B. appointed by Congress for 14-year terms. C. appointed by the president for 14-year terms. D. appointed by the Supreme Court for lifetime terms.