Assume a company is at a point in production where marginal product is below average product. Which of the following must be true?
A. Diminishing marginal product must have set it.
B. Marginal product must be falling.
C. Average product must be falling.
D. All of these are true.
D. All of these are true.
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Assume that the graphs show a competitive market for the product stated in the question.
Select the graph above that best shows the change in the digital camera market when the productivity of workers who produce cameras increases.
A. graph (1) B. graph (2) C. graph (3) D. graph (4)
Drawing conclusions from international comparisons of GDP are difficult to assess because
A) GDP is understated in poorer countries because much of the work that people do is not provided in markets. B) GDP cannot be adequately evaluated as a measure of people's welfare or well-being. C) without adjusting for purchasing power parity, GDP comparisons might very well be meaningless. D) all the above reasons hold true.
________ is a group of firms that have colluded to limit their output and raise their price
A) A cartel B) An oligopoly C) A strategy D) A duopoly
In the text, the authors present evidence that the market for free agents in professional baseball is subject to the lemons problem. How could a prospective free agent overcome this problem when seeking a new contract?
A) Agree to accept a lower salary with a new team. B) Rely on standardization to avoid the asymmetric information problem. C) Decide to negotiate only with their current team. D) Develop a reputation as a reliable and productive player.