Which of the following statements is false?
A. Perfect substitutes do not need to be employed in a one-to-one ratio by the firm.
B. Perfect complements are associated with right-angled isoquants.
C. Perfect substitutes are associated with linear isoquants.
D. The elasticity of substitution can be positive or negative.
E. The more two factors are substitutes in the firm's production function, the greater is the elasticity of substitution.
Answer: D
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Which of the following would most likely be a private good?
A) a Mariah Carey CD B) Sirius Satellite Radio is accessed through a subscription. C) Michigan Radio is the state's most listened-to public radio service. D) iTunes sells songs through their website.
Juanita is trying to convince the owner of a jewelry store to hire her. She argues that she could help the shop sell an additional three rings per day for a profit of $20 each. If the facts are not in dispute, but the owner does not hire her, then
a. the wage rate must be less than $60 per day. b. hiring Juanita would involve a negative marginal product. c. the wage rate must be more than $60 per day. d. the wage rate must be less than $20 per day.
An open-access good is often subject to which of the following problems?
a. Limited entry and restrictive harvest regulations b. High levels of economic rent c. The common-pool problem d. Government regulation
A supply shock causes a shift in:
What will be an ideal response?