Consider a perfectly competitive firm that produces computers. Each additional worker at this firm can produce four computers. Calculate the marginal factor cost if the computers are sold for $1,000 each, and the firm is maximizing profit. (Assume that marginal revenue product is the product of marginal product of the input and the marginal revenue of the firm.)
a. $4,000
b. $500
c. $1,000
d. $1,500
e. $400
a
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The planned investment function will shift downward if
A) real disposable income increases. B) the interest rate falls. C) business expectations become more pessimistic. D) the existing stock of capital decreases.
In the U.S. balance of payments, purchases of foreign assets by U.S. residents are tabulated as a:
a. unilateral transfer. b. capital outflow. c. current account outflow. d. capital inflow.
Fixing the insolvency problem caused by the Great Recession, the U.S. Federal Reserve as reluctant to purchase toxic assets from banks because:
a. It could cause an unwanted expansion of the e U.S. monetary base. b. Toxic security purchases had to be funded, and the Fed already had a major debt problem. c.It could cause an unwanted contraction of the U.S. monetary base. d. The Fed could be accused of nationalizing the U.S. financial system. e. All of the above.
If demand is __________ and price is __________, total revenue will _________.
A. inelastic; raised; increase B. elastic; raised; increase C. inelastic; lowered; increase D. elastic; lowered; decrease