Engineers for The Giffen Record Company have determined that a 35% increase in all compact disc inputs will cause a 45% increase in output. Assuming that input prices remain constant, you correctly deduce that such a change will cause ________ as output increases.
A. average costs to increase
B. average costs to remain constant
C. average costs to decrease
D. marginal costs to increase
Answer: C
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What is the impossibility theorem?
What will be an ideal response?
Suppose a patent is granted for a product that has the linear demand curve P = a - b Q. The constant marginal cost of producing this product is $50 per unit, a unit sells for $150, and consumers purchase 100 units of the good at that price
If the monopoly is maximizing profit, b equals A) 1. B) 1.5. C) 2. D) 2.5.
Assume that the market-clearing wages are $10 per hour in a safe job and $18 per hour in a risky job. Then, at the completion of a war, many ex-soldiers who enjoy risky ventures enter the labor market. Which of the following is not a likely outcome of this change?
A. The wage differential will decrease. B. The wage associated with risky jobs will decrease. C. The number of people working risky jobs will increase. D. Many firms that currently offer risky jobs will begin offering safe jobs. E. The fraction of people working safe jobs will decrease.
Price discrimination only occurs when consumers have only partial information about a product's price and availability.
Answer the following statement true (T) or false (F)