Suppose that a firm chose an output level where the total cost and total revenue curves intersect. At this level of output,
a. the firm is maximizing profits
b. the firm is minimizing losses
c. profit is zero
d. total revenue is maximized
e. total cost is minimized
C
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Refer to Scenario 15.5. What is the total amount Catherine will lose in earnings by being a smoker, if she works now and continues until age 65?
A) $1500 B) $67,500 C) $90,000 D) $97,500 E) $120,000
A young chef is considering opening his own sushi bar. To do so, he would have to quit his current job, which pays $20,000 a year, and take over a store building that he owns and currently rents to his brother for $6,000 a year. His expenses at the sushi bar would be $50,000 for food and $2,000 for gas and electricity. What are his explicit costs?
a. $26,000. b. $66,000. c. $78,000. d. $52,000. e. $72,000.
Suppose you received a 5 percent increase in your nominal wage. Over the year, inflation ran about 2 percent. Which of the following is true?
a. Your real wage fell. b. Your nominal wage fell. c. Both your nominal and real wages decreased. d. Although your nominal wage fell, your real wage increased. e. Both your nominal and real wages increased.
Whenever the ratio of marginal products to input prices differs across inputs,
A. no change will necessarily follow because the process could still be at peak efficiency. B. a firm's costs could be reduced by shifting input usage toward the input with the lower marginal product to price ratio. C. the marginal products of inputs will adjust as input combinations change to correct for the inefficiency. D. the costs of the inputs adjust to bring the marginal product ratios and cost ratios together.