Rodolfo gets 1 util from regular potato chips, 4 utils from salt-and-vinegar chips, and 6 utils from barbeque-flavored chips. If regular potato chips cost $3.00, which of the following pricing structures represents consumer equilibrium?
a. salt-and-vinegar: $3.00; barbeque: $3.00
b. salt-and-vinegar: $4.00; barbeque: $6.00
c. salt-and-vinegar: $6.00; barbeque: $8.00
d. salt-and-vinegar: $12.00; barbeque: $18.00
d. salt-and-vinegar: $12.00; barbeque: $18.00
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The manager of Steel Works learns of a new technological interdependency between the first stage and the intermediate stage of production. If Steel Works currently contracts with another firm for the intermediate stage of production, which of the following is true?
A) The manager has less of an incentive to integrate forward. B) The manager has less of an incentive to integrate backward. C) The manager has more of an incentive to integrate backward. D) The manager has more of an incentive to integrate forward.
Consider a demand curve for peaches. Which of the following movements will be observed if the price of peaches decline at a point in time?
a. The demand curve will rotate inward at the given price level. b. The will be a movement up along the demand curve. c. The demand curve will rotate outward at the given price level. d. There will be a downward movement along the demand curve. e. The demand curve will become steeper.
If most firms in an industry are earning a 7 percent rate of return on their assets, but your business is earning 9 percent, your rate of economic profit is
a. minus 2 percent. b. 2 percent. c. 9 percent. d. 16 percent.
On average, collective bargaining increases wages
a. true b. false