Which of the following is true about average fixed cost?
A. Average fixed cost has a U-shape, and marginal cost crosses average fixed cost at its minimum point.
B. Average fixed cost does not vary as output increases.
C. Average fixed cost is the difference between marginal cost and average total cost.
D. Average fixed cost is total fixed cost divided by the quantity of output produced, and it declines steadily as output increases.
Answer: D
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If the price level rises by 4 percent and workers' money wage rates increase by 2 percent, then the
A) quantity of labor supplied decreases. B) quantity of labor supplied increases. C) quantity of labor supplied does not change because there is no change in the real wage rate. D) the supply curve of labor shifts rightward.
Say's Law
a. cannot be satisfied if there is excess supply or demand in individual markets in the long run b. ensures that every firm will sell all of its output c. can be satisfied even if there is a general overproduction or underproduction of goods in the economy d. is satisfied only if every market clears in the short run e. shows that the total value of spending in the economy will equal the total value of the output produced
Which of the following statement is FALSE?
A) Only the price system can be used to ration goods. B) Random assignment can be a method of rationing. C) Coupons can be used to ration goods. D) Queuing can be used for rationing.
The marginal product curve of input Y shows
A. how the average quantity of output produced varies with input Y, holding all other inputs constant. B. how the quantity of output produced changes for each amount of input Y, whether or not all other inputs are held constant. C. how the quantity of output produced changes for each amount of input Y, holding all other inputs constant. D. how the average quantity of output produced varies with input Y, whether or not all other inputs are held constant.