Following is a firm's expansion path. The price of capital is $5 per unit; the price of labor is $2 per unit. 
When output is 30 units, what is long-run total cost?
A. $60
B. $150
C. $105
D. $260
E. none of the above
Answer: C
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Define induced expenditure and autonomous expenditure. Which expenditure items are induced expenditure and which are autonomous expenditure?
What will be an ideal response?
Milky Moo and Mega Cow are the only sellers of milk. Milky Moo's supply function is QsMMoo = 12P - 6 at prices above $0.50 and zero at prices below $0.50. Mega Cow's supply function is QsMCow = 9P - 3 at prices above $0.33 and zero at prices below $0.33. At a price of $2.00:
A. the market supply of milk is 33 units. B. the market supply of milk is 15 units. C. the market supply of milk is 18 units. D. the market supply of milk is 42 units.
Based on the graph showing marginal cost pricing versus average cost pricing, if the government makes the natural monopolist use marginal cost pricing, the monopoly will ______ money because PMC is ______ than ATC.
a. make; less
b. make; more
c. lose; more
d. lose; less
According to the theory of purchasing power parity, why should identical goods have the same price in different locations?
a. To prevent price gouging, international law mandates that identical goods must be sold for the same currency-adjusted price across all locations. b. If the goods were two different prices, it would cause an increase in supply of the good at the low-price location and a decrease in supply of the good at the high-price location, which would cause the prices in each location to converge to the same price. c. If the goods were two different prices, it would cause an increase in supply of the good at the high-price location and a decrease in supply of the good at the low-price location, which would cause the prices in each location to converge to the same price. d. If the goods were two different prices, it would cause a decrease in demand of the good at the low-price location and an increase in demand of the good at the high-price location, which would cause the prices in each location to converge to the same price.| e. If the good were two different prices, it would cause an increase in demand of the good solely at the low-price location until that good reached the sameprice as the good in the high-price location.