The income effect is the change in the quantity demanded of a good that results from
a. the effect of a change in the price on consumer purchasing power.
b. the effect of a change in the price making the good more or less expensive relative to other goods,
holding constant the effect of the price change on consumer purchasing power.
c. either (a) or (b).
d. none of the above.
a. the effect of a change in the price on consumer purchasing power.
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An example of a variable cost to the firm is the
a. monthly rent it pays based on a multiple-year lease b. cost of shipping the goods it produces c. property taxes it pays d. interest payments on a bank loan e. entrepreneur's opportunity cost
A macroeconomist would be interested in the
a. general rise of prices b. decline of cheese prices c. fluctuation of oil prices d. sharp rise of coffee prices
Refer to the table above. What is the total cost of producing 145 units of the good?
A) $90 B) $180 C) $190 D) $210
Because the value of marginal product diminishes as the quantity of labor employed increases, the ________ the wage rate, the ________ workers the firm hires
A) lower; more B) higher; more C) lower; fewer D) None of the above answers is correct because there is no relationship between the wage rate and the number of workers hired.