A farmer is deciding whether or not to add fertilizer to his or her crops. If the farmer adds 1 pound of fertilizer per acre, the value of the resulting crops rises from $80 to $100 per acre. According to marginal analysis, the farmer should add fertilizer if it costs less than:
A. $12.50 per pound.
B. $20 per pound.
C. $80 per pound.
D. $100 per pound.
Answer: B
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If a binding price floor is imposed on the market for eBooks, then
a. the demand for eBooks will decrease. b. the supply of eBooks will increase. c. a surplus of eBooks will develop. d. All of the above are correct.
Which of the following could cause a recession?
A. A decline in aggregate demand B. A decline in unemployment C. An increase in aggregate supply D. An increase in government spending
A point inside the production possibilities curve illustrates that resources are not being used as efficiently as possible.
Answer the following statement true (T) or false (F)
Which types of industries are hit hardest by a recession? Explain.
What will be an ideal response?