Refer to the above diagram. At output level Q :
A. marginal product is rising.
B. marginal product is negative.
C. marginal product is falling.
D. one cannot determine whether marginal product is falling or rising.
Answer: C
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A transfer payment is a sum of money
A. spent by government for new goods and services. B. shifted between members of a household. C. given by government without a good or service in exchange. D. moved between companies for goods and services. E. required to pay taxes.
If the price of a DVD falls,
i. the demand curve for DVDs will shift rightward. ii. the demand curve for DVDs will not shift. iii. there will be a movement along the demand curve for DVDs. A) i only B) ii only C) iii only D) ii and iii E) i and iii
Brian is paid monthly and typically takes $500 of his pay in cash to spend throughout the month, and the rest he leaves in an interest-bearing checking account. With the recent inflation, Brian finds it necessary to go to the bank every week, withdrawing $125 each time, so that his money can earn interest for as long as it can before Brian needs to withdraw it. The added hassle of going to the bank more often in response to inflation is called a:
A. shoe-leather cost. B. menu cost. C. transactions cost. D. tax distortion.
If the price of a good in a closed economy is lower than the world price, then with an open economy this country will be a ________ of that good.
A. price setter B. net importer C. price taker D. net exporter