Radon Research Corporation (RRC) is one of 24 firms in Albuquerque testing homes for dangerous levels of radon gas. There is a standard test that all testing companies use. The manager of RRC wants to know the number of homes to test in 2015 in order to maximize the firm's profit. The manager forecasted a price of $160 for radon tests in 2015. The firm's marginal cost was estimated asSMC = 200 ? 15Q + 0.8Q2where Q is the number of tests performed each week. RRC's fixed cost will be $250 per week. The average variable cost at RRC is
A. 200 ? 7.5Q + 0.2667Q2
B. 200Q ? 15Q2 + 0.8Q3
C. 100 ? 10Q + 0.4Q2
D. 200 ? 30Q + 1.6Q2
E. none of the above
Answer: A
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A) $30 B) $300 C) $450 D) $600
Investment in both physical and human capital enhances economic growth because it:
a. increases consumption during the current period. b. makes it possible for individuals to produce more goods and services per hour worked. c. encourages firms to expand output by employing more low-productivity workers. d. encourages workers to unionize and, thereby, fight for higher wages.
Which of the following is true? a. Virtually all theories in economics are expressed using a ceteris paribus ("let everything else be equal" or "holding everything else constant") assumption. b. The fallacy of composition is that, even if something is true for an individual, it is not necessarily true for many individuals as a group. c. One must always be careful not to confuse correlation
with causation. d. All of the above are true.
In the circular flow model, the value of total production for an economy ________ the value of total expenditures on final goods and services.
A) equals B) is less than C) may be greater than or less than D) is greater than