In the above figure, if d4 is the relevant demand curve for this firm, then which level of output will maximize this firm's profits or minimize its losses?
A. A
B. B
C. C
D. D
Answer: D
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The extra pay people earn in exchange for undertaking risky or otherwise undesirable work is called
A) a compensating differential. B) arbitrage income. C) overtime pay. D) a fringe benefit.
Which of the following would be likely to change the relative efficiency of trucks versus trains in carrying freight?
A) Higher wages for truck drivers B) More powerful locomotives C) Tolls on interstate highways D) All of the above.
The Bureau of Economic Analysis calculates the PCE deflator ________
A) every month B) every two months C) every three months D) every year E) twice each month
Vertically integrated firms can use transfer pricing
A) to avoid government price controls. B) as a way to compensate managers for transferring among departments in a vertically integrated firm. C) to avoid paying market prices for inputs. D) to shift profit.