Consider the supply and demand curves depicted in the diagram below. If the government imposed a price ceiling of $15, then buyers will be intending to buy ___, but they will be able to legally buy ____
A. 30 units; 24 units
B. 36 units; 24 units
C. 36 units; 30 units
D. 24 units; more than 24 units
B. 36 units; 24 units
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The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
Chuckie's Pizza Palace produces gourmet pizzas that sell for $20 each. Assume that labor is the only input that varies for the firm. If Chuckie hires 10 workers, he can produce and sell 600 pizzas per week. If he hires 11 workers, he can produce and sell 650 pizzas per week. Chuckie pays each of his workers $400 per week. Which of the following is correct?
a. For the 11th worker, the marginal profit is $1,000. b. For the 11th worker, the marginal revenue product is $1,000. c. The firm is maximizing its profit. d. If the firm is employing 11 workers, then its profit would increase if it cut back to 10 workers.
What matters most in determining efficient distribution of production over the world is
A. absolute advantage. B. efficiency. C. the stock of resources. D. comparative advantage.
If the price of a good rises, then the effect on the income of the factors that are used intensively in its production will be
A) to raise income by an absolute amount that is less than the rise in prices. B) to raise income by an absolute amount that is more than the rise in prices. C) to raise income by a smaller percentage than the rise in prices. D) to raise income by a greater percentage than the rise in prices.