Suppose notebooks are produced by a competitive constant-cost industry. Which of the following must cause Nanna's Notebooks to exit the industry in the long run?
a. Nanna's is notified of a rent increase, but her competitors' rents are unchanged.
b. A fire destroys half of Nanna's inventory.
c. A photographer wins a $10,000 judgment from a lawsuit charging that Nanna's used his photos on notebook covers without permission.
d. The price of cardboard used in notebook production rises.
a. Nanna's is notified of a rent increase, but her competitors' rents are unchanged.
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A natural monopoly is characterized by large fixed costs relative to variable costs
Indicate whether the statement is true or false
A firm has the following production relationship between labor and output, for a fixed capital stock.
According to the above table, what is the marginal product of the 4th unit of labor?
A. 3 B. 5 C. 6 D. 7
If supply is highly elastic and demand shifts to the right:
A. price and quantity will hardly change at all. B. price will rise significantly; quantity hardly changes at all. C. price will hardly change at all; quantity will rise significantly. D. price will rise significantly as will quantity.
Moving from one point on the production possibilities frontier to another ________
A) involves a tradeoff but does not incur an opportunity cost B) involves an opportunity cost but no tradeoff C) involves a tradeoff and incurs an opportunity cost D) involves no tradeoff but it does incur an opportunity cost