Refer to Table 4-6. The table above lists the marginal cost of polo shirts by Marko's, a firm that specializes in producing men's clothing. If the price of polo shirts increases from $15 to $20
A) the marginal cost of producing the third polo shirt will increase to $20.
B) there will be a surplus of polo shirts.
C) producer surplus will rise from $13 to $28.
D) consumers will buy no polo shirts.
C
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A positive statement:
A. can actually be false. B. must always be true. C. provides an opinion with a positive outlook. D. is the same as a normative statement.
While the classical economists believed that both velocity and output are stable, Keynesians believe:
a. velocity and output are both variable. b. output is stable and velocity is variable. c. the same as the classical economists that both output and velocity are stable. d. velocity is stable and output is variable.
Recall the Application about determining the optimal level of methane abatement to answer the following question(s).Recall the Application. The EPA has estimated the cost of methane recovery at different recovery levels. Given those costs, the efficient level of methane recovery:
A. depends on the estimate of the marginal benefit of methane recovery. B. is zero because the costs exceed the benefits. C. will increase if scientists determine that methane is not as harmful as it is currently thought to be. D. will include only recovery from landfills and coal mines, but not from natural gas distribution.
Adaptive expectations assumes that individuals
A) can accurately predict the future. B) base predictions on random events (i.e., animal spirits). C) form their predictions of macroeconomic variables randomly. D) use all available information in predicting the future. E) none of the above