Critics of the marginal productivity theory of income distribution claim that the theory is flawed due to:
A. The law of diminishing returns
B. The existence of imperfect competition, such as of monopoly and monopsony, in output and resource markets
C. The problem of comparing different kinds of resources, such as capital and labor
D. Government policies which redistribute income
B. The existence of imperfect competition, such as of monopoly and monopsony, in output and resource markets
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The figure above shows the U.S. demand and U.S. supply curves for cherries. Suppose the world price of cherries is $2 per pound. At this price, U.S. consumption of cherries will equal
A) 200,000 pounds. B) 400,000 pounds. C) 600,000 pounds. D) 800,000 pounds. E) 0 pounds.
"The distribution of income should be left to the market" is an example of a positive economic statement
Indicate whether the statement is true or false
The main objective of advertising for a monopolistically competitive firm is
A) to differentiate the product and boost demand. B) to reduce cost. C) to earn long run profits. D) none of the above.
One concern over external national debt is that interest and principal payments transfer wealth overseas. The percentage of the national debt held in recent years by foreigners is approximately:
a. 5 percent. b. 10 percent. c. 20 percent. d. 30 percent. e. 50 percent.