Diminishing returns set in when a firm increases its labor and capital at the same time
Indicate whether the statement is true or false
F
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If a price floor of $10 a bottle is imposed on wine from California,
a. all wine from California becomes more expensive. b. all wine from California becomes cheaper. c. the price of some wines will increase. d. the price floor will have no effect.
The demand for a product is likely to be more elastic
A. the shorter the time the consumer has to adjust to price changes. B. the lower the price of the good. C. the fewer the number of good substitutes. D. the less the essential nature of the good.
Which of the following is false of perfectly competitive firms?
a. A perfectly competitive market is approximated in highly organized markets for securities and agricultural commodities. b. The perfectly competitive model does not require any knowledge on the part of individual buyers and sellers about market demand and supply curves. c. Because perfectly competitive firms are price takers, each firm's demand curve remains unchanged even when the market price changes. d. In a perfectly competitive market, marginal revenue is constant and equal to the market price.
Judgmental and decision heuristics are:
A. rules of thumb that reduce computation costs. B. a way of calculating computation costs. C. derived from the rational choice model but imply higher computation costs. D. used to test the rational choice model when computation costs are small.