If a small change in output results in a large change in marginal cost, the marginal cost curve is ________, which makes accurate forecasts ________ valuable.
A) flat; more
B) steep; less
C) flat; less
D) steep; more
B) steep; less
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Suppose the demand for hot dogs decreases. In the short run, firms that produce hot dogs will experience a fall in prices, which will induce them to
A) decrease production and reduce the number of workers. B) decrease production and increase the number of workers. C) increase production and reduce the number of workers. D) increase production and increase the number of workers.
Refer to Figure 7-1. Suppose the government allows imports of leather footwear into the United States. The market price falls to $24. What area represents domestic producer surplus?
A) T + U B) V + W + X + Y C) W + X + Y D) V
Refer to the above figure. Which of the following statements is TRUE?
A) Under perfect competition, the efficient price is charged, which is the lowest price possible (P1 ) while under monopoly output is too large (Q4 ) and price is too high (P4 ). B) Under perfect competition price equals marginal cost (P3 ) while under monopoly price (P4 ) is greater than marginal cost (P1 ). C) The rate of output is the same under both monopoly and perfect competition (Q1 ), but price is higher under monopoly (P4 rather than P1 ). D) Price equals marginal cost under both monopoly and perfect competition, but output is too low under monopoly (Q1 instead of Q2 ).
What is the meaning of "a defective telescopic faculty," as described by A.C. Pigou?
a. Persons are unable to plan rationally for consumption. b. Persons zero in on something and cannot consider alternatives. c. Persons seek long-term goals and ignore present problems. d. Persons are unable to give adequate weight to the future.