Suppose a shift of the labor-demand curve results in an increase of $5 in the equilibrium wage. How does this shift affect the value of the marginal product of labor?
The shift must increase the value of the marginal product of labor by $5 as well.
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Monopolistic competitors advertise because
A) they have downward sloping demand curves. B) the demand curves they face are very elastic. C) they produce goods that can be differentiated from the goods of other firms in the industry. D) they can earn long-run profits if they advertise.
Perfectly competitive firms maximize their profit by producing the output level where P = MR = AVC.
Answer the following statement true (T) or false (F)
What are the strengths and weaknesses of the negative income tax (NIT) as an alternative to traditional welfare programs?
Which of the following scenarios shows an increasing-cost industry?
a. As the demand for cotton shirts drops, the price of cotton suitable for making this product rises. b. As the demand for computers rises, the price of microchips for making this product drops. c. As the demand for raspberries rises, the price of land suitable for growing this crop rises. d. As the demand for wooden rulers drops, the price of lumber for making this product stays constant.