If the marginal factor cost of hiring an additional worker is $10 while the marginal revenue product is $15, then the firm should
A. hire more workers.
B. fire some workers.
C. stop hiring more workers.
D. none of these: insufficient information to answer the question.
Answer: A
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Suppose we have an economy in which G = 1100, t = 0.26, Y = 3800, and YN = 4000. At Y the cyclical deficit is
A) 60. B) 112. C) -172. D) -52. E) 52.
If only two identical firms operate in a market, consumers prefer
A) a Cournot equilibrium. B) a Stackelberg equilibrium. C) a collusive equilibrium. D) any equilibrium since they all result in the same consumer surplus.
Expansionary fiscal policy is used to
A) combat inflation. B) combat recessions. C) encourage private saving. D) make businesses more efficient.
A decrease in the price of digital cameras would lead to a(n):
A. Increase in the price and quantity sold of memory cards B. Decrease in the price and quantity sold of memory cards C. Increase in the price and a decrease in quantity sold of memory cards D. Decrease in the price and an increase in quantity sold of memory cards