An increase in the price of fuel increases the average cost of production of fabric produced by the Houchen Textile Company, a competitive firm. As a result of the increase in the price of fuel,
a. average cost of production will increase, but there will be no change in the profit-maximizing level of output.
b. average cost of production will increase and the profit-maximizing level of output will decline.
c. fixed costs of production will increase.
d. average cost of production will increase, as will the profit-maximizing level of output.
b. average cost of production will increase and the profit-maximizing level of output will decline.
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In the Keynesian model, a $1 billion increase in autonomous consumption leads to ________ in equilibrium output.
A. no change B. a greater than $1 billion increase C. a $1 billion decrease D. a $1 billion increase
In 1981, in San Francisco Solano, Argentina, about 1,800 families took over a piece of wasteland. The government was able to deed 60 percent of this land to some families while the remaining part could not be deeded. The resulting houses varied greatly, based on whether the residents received title. Those who received title also behaved differently, having fewer children, and the children
experienced more education and better health. This is an example of the results from: a. scarcity. b. economic growth. c. economic freedom. d. private property rights. e. improved quality of life.
Resources devoted to complying with the tax laws are a type of deadweight loss
a. True b. False Indicate whether the statement is true or false
Your neighbors have offered to pay you to look after their dog while they are on vacation. It will take you one hour per day to feed, walk, and care for the dog, which you can do either before or after you go to work. Your regular job pays $10 per hour, and you can work up to eight hours per day. The smallest amount of money you would accept to look after your neighbor's dog each day is equal to:
A. $15, because overtime wages are generally 1.5 times your regular wage when you work more than eight hours a day. B. zero, because your regular job is not available for more than eight hours per day. C. $10, because that is your opportunity cost of one hour of work. D. the value you place on one hour of leisure.