The value of the marginal product of labor, VMPL, for the perfectly competitive firm equals
A. the revenue from the sale of one more unit of output.
B. the total revenue the firm will get by selling the equilibrium amount of output.
C. the price of the product being produced by labor.
D. the extra revenue the firm gets by selling the output of one additional unit of labor.
Answer: D
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If the government removes a tax on suppliers, then this will cause the ________ schedule to shift ________.
A. demand, right B. demand, left C. supply, right D. supply, left
Refer to Figure 7-5. Fenwick currently both produces and imports pistachios. The government of Fenwick decides to restrict international trade in pistachios by imposing a quota that allows imports of only 5 million pounds each year
Figure 7-5 shows the estimated demand and supply curves for pistachios in Fenwick and the results of imposing the quota. Answer questions a-j using the figure. a. If there is no quota what is the domestic price of pistachios and what is the quantity of pistachios demanded by consumers? b. If there is no quota how many pounds of pistachios would domestic producers supply and what quantity would be imported? c. If there is no quota what is the dollar value of consumer surplus? d. If there is no quota what is the dollar value of producer surplus received by producers in Fenwick? e. If there is no quota what is the revenue received by foreign producers who supply pistachios to Fenwick? f. With a quota in place what is the price that consumers of Fenwick must now pay and what is the quantity demanded? g. With a quota in place what is the dollar value of consumer surplus? Are consumers better off? h. With a quota in place what is the dollar value of producer surplus received by producers in Fenwick? Are domestic producers better off? i. Calculate the revenue to foreign producers who are granted permission to sell in Fenwick after the imposition of the quota. j. Calculate the deadweight loss as a result of the quota.
Net taxes are indirect business taxes plus transfer payments
a. True b. False Indicate whether the statement is true or false
If the marginal propensity to save is 0.40, a $20 billion increase in investment spending would cause equilibrium output to:
a. increase by $50. b. increase by $80. c. decrease by $33. d. decrease by $40. e. decrease by $20.