Refer to the above table. If the price of the good produced is $10 and the wage rate is $500, then the marginal revenue product of the 5th worker is
A. $50.
B. $10.
C. $750.
D. $4,750.
Answer: C
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When the government is the sole depository of foreign currencies and exercises complete control over how these currencies may be used, this
a. is a violation of International Monetary Fund regulations for member countries because it denies the right of market forces to determine exchange rates b. creates equilibrium in the foreign exchange market which would otherwise not occur c. is an example of exchange controls that allow a government to maintain a fixed exchange rate d. is necessary in a floating exchange rate system to keep the market in equilibrium e. stimulates international trade because it eliminates all the uncertainty associated with floating exchange rates
In Figure 8.10, airline Fly Smart is initially a secure monopoly between two cities X and Y at point M, serving 300 passengers per day at the profit-maximizing price of $300 per ticket. Suppose that Fly Smart discovers that a second airline is contemplating entering the market. If the minimum market entry quantity is 130 passengers per day, what price should Smart Fly charge to secure the entry-deterring quantity?
A. $300 B. $220 C. $180 D. $100
An increase in the value of a currency relative to other currencies is called a(n):
A. overvaluation. B. appreciation. C. evaluation. D. devaluation.
Compare the consumer surplus, producer surplus, and deadweight loss that arise from average cost pricing with those that arise from profit-maximization pricing and marginal cost pricing
What will be an ideal response?