If the supply of loanable funds shifts right, then the equilibrium
a. levels of net capital outflow and domestic investment decrease.
b. level of net capital outflow increases and the equilibrium level of domestic investment decreases.
c. level of net capital outflow decreases and the equilibrium level of domestic investment increases.
d. levels of net capital outflow and domestic investment increase.
d
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In a simple economy (no government), the vertical distance between the consumption function and the expenditure schedule measures
A. undesired inventory depletion. B. planned investment C. undesired investment. D. unintended investment.
Hotspur Incorporated, a manufacturer of microwaves, is a price taker in both the input and output markets. To maximize its profit, Hotspur will hire labor up to the point where
A) the marginal revenue product of labor equals the wage rate. B) the marginal revenue product of labor equals the output price. C) the marginal product of labor is no longer positive. D) all economies of scale have been exhausted.
Joe's bell pepper stand is a competitive firm. Joe sells 90 bell peppers a day, and the market price for bell peppers is $5. Below is Joe's cost curves (price is measured in dollars and quantity is measured in number of peppers).
What can you say about Joe's short-run decision regarding shutdown?
a. The market price is too low, so Joe should shut down
b. The market price is too high, so Joe should shut down
c. The market price is high enough to cove relevant costs, so Joe should operate
d. At the market price the Joe will earn positive profit, so he should operate
Which of the following is a relevant cost?
A) replacement cost B) sunk cost C) historical cost D) fixed cost E) All of the above are relevant.