As a firm expands its output, cost per unit of output (average cost) decreases and then increases. Average cost and output have
A) a relationship with a minimum.
B) a relationship with a maximum.
C) no relationship.
D) a linear positive relationship.
A
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Sammy has a drone that he values at $1,500. Frank values the same drone at $1,000. The government offers a subsidy of $800 to the buyers of drones, and Sammy and Frank agree on a price of $1,600. The cooperative surplus for Sammy and Dean will be
A) $200. B) $300. C) $600. D) $800.
(Appendix) If the cost of search is $3, and wages are uniformly distributed between $20 and $50, what is the smallest wage you should accept if you are risk neutral?
A. 28.73 B. $36.58 C. $33.42 D. $46.58
In a regression equation, changing the units of measurement of only the independent variable does not affect the _____.
A. ?dependent variable B. ?slope C. ?intercept D. ?error term
Within the Keynesian aggregate expenditures model, which of the following autonomous changes would decrease the equilibrium output?
A. A decrease in investment spending. B. An increase in net exports. C. An increase in government spending. D. An increase in consumption expenditures