A baker can produce two products: cupcakes and pies. The table below is the baker's production possibilities schedule:Production Possibilities ScheduleProductABCDEFCupcakes01220365681Pies1086420Going from E to C shows that the opportunity cost of an additional 4 pies is
A. 36 cupcakes.
B. 56 cupcakes.
C. 20 cupcakes.
D. 25 cupcakes.
Answer: A
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Assume that Figure 4-16 shows the supply of orange juice. A decrease in the wage rate paid to workers in the orange juice industry will shift supply from
A. S1to S2. B. S2to S1. C. S3to S2. D. S3to S1.
Economics does not study correct or incorrect behaviors but rather it assumes that economic agents behave ________, meaning they make the best decisions given their knowledge of the costs and benefits
A) emotionally B) equitably C) selfishly D) rationally
If a natural monopolist is unregulated, then
A) the monopoly will produce efficiently from society's point of view. B) the monopoly will produce inefficiently from society's point of view. C) the monopolist will be earning just a normal rate of return on investment. D) the monopolist will determine the profit maximizing quantity by equating marginal cost to the demand curve.
Vertical integration is
a. the expansion of a firm into earlier or later stages of production b. an attempt by a firm to allow market prices to coordinate more transactions c. an attempt by a firm to minimize shirking d. an attempt by a firm to minimize the need to coordinate transactions within its boundaries e. a way for a firm to accumulate information about its competitors