Refer to the graph shown. If labor costs $10 per unit and machines cost $15 per unit, the economically efficient cost of producing 500 units of output is:
A. $150.
B. $100.
C. $300.
D. impossible to determine using the information given.
Answer: A
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Sammy has a drone that he values at $1,500. Dean values the same drone at $2,000. Sammy decides to sell the drone to Dean for $1,800. If the government imposes a $350 tax on the sale of drones,
A) Sammy and Dean would not be able to complete the transaction. B) Sammy and Dean would still be able to complete the transaction. C) the tax would cause a deadweight loss of $500. D) Both A and C are correct.
For a fixed proportion production function, at the vertex of any of the (L-shaped) isoquants the marginal productivity of either input is a. constant b. zero
c. negative. d. a value that cannot be determined.
Suppose a perfectly competitive market results in a long-run equilibrium price of $8 and quantity of 500. If this same market were a monopoly, which of the following price and quantity combinations would be the most likely?
A. Price: $10, Quantity: 350 B. Price: $8, Quantity: 500 C. Price: $6, Quantity: 650 D. Price will equal marginal revenue and quantity will be found where marginal revenue equals marginal cost.
Use the indifference curves and the budget lines in Figure 19.3 to answer the indicated question. Assume the price of Y is $1 per unit. If the price per unit of good X is $1, the optimal consumption is found at point
A. D. B. E. C. C. D. B