A country that must decrease production of one good in order to increase the production of another
A) must be using resources inefficiently.
B) must be producing on its production possibilities frontier.
C) must be producing beyond its production possibilities frontier.
D) must have private ownership of property.
B
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Hotspur Incorporated, a manufacturer of microwaves, is a price taker in both the input and output markets. To maximize its profit, Hotspur will hire labor up to the point where
A) the marginal revenue product of labor equals the wage rate. B) the marginal revenue product of labor equals the output price. C) the marginal product of labor is no longer positive. D) all economies of scale have been exhausted.
By the permanent-income hypothesis, the MPC of transitory income is
A) k. B) j. C) kj. D) k - j. E) 0.
The free rider problem is triggered when a good is ________, and the tragedy of the commons arises when a good is ________
A. both rivalrous and nonexcludable; rivalrous. B. nonexcludable; both rivalrous and nonexcludable. C. rivalrous; both rivalrous and nonexcludable. D. both rivalrous and nonexcludable; excludable.
The merger between two general merchandise stores, Sears and Kmart, each of which carried some specialty items, most likely produced:
A. economies of scale but not economies of scope. B. neither economies of scope nor economies of scale. C. economies of scope but not economies of scale. D. both economies of scope and economies of scale.