The marginal productivity principle implies that
A. quantity demanded of an input normally declines as the input price falls.
B. at equilibrium, profit from the last unit of input will be zero.
C. for maximizing profit, marginal revenue product should be greater than price.
D. marginal productivity of inputs increase when price of inputs increase.
Answer: B
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Equilibrium price and quantity are determined by:
A. both supply and demand. B. demand. C. supply. D. government regulations.
If the CPI in City A is 150 and the CPI in City B is 135,
a. the dollar has greater purchasing power in City B. b. prices are higher in City A than they are in City B. c. City B must be using a different base year. d. None of these.
If you have $2 million in a CD at a commercial bank that is a member of the FDIC, how much of your funds are uninsured?
A) $0 B) $1 million C) $1.75 million D) $2 million
How does monopoly product quality compare to the quality a social planner would choose? a. The monopolist targets the marginal consumer's valuation of quality, whereas the social planner targets the average consumer's. This leads the monopolist to make inefficiently low-quality products. b. The monopolist targets the marginal consumer's valuation of quality, whereas the social planner targets
the average consumer's. This leads the monopolist to make inefficiently high-quality products. c. There is no difference due to a standard neutrality argument. d. None of the above.