Suppose an agent must pay the full marginal cost for an item but splits the marginal revenue with the principal. As a result,
A) joint profit is maximized.
B) joint profit is not maximized.
C) the agent will not enter into such a contract.
D) the agent wishes to sell as many items as he can.
B
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Refer to Figure 9.9. Now suppose an import quota of 3000 trucks is imposed. The quota will make total domestic producer surplus equal to
A) $2,500. B) $5,000. C) $5,000,000. D) $10,000,000. E) $30,000,000.
One way in which the Phillips curve is misinterpreted is to think of it as
a. a model of economic activity that explains changes in unemployment and inflation by changes in aggregate demand. b. a statistical relationship between inflation and unemployment. c. depicting a number of alternative equilibrium points the economy could achieve. d. All of the above.
If a dollar buys more corn in the U.S. than in Mexico, then
a. the real exchange rate is greater than 1; a profit might be made by buying corn in the U.S. and selling it in Mexico. b. the real exchange rate is greater than 1; a profit might be made by buying corn in Mexico and selling it in the U.S. c. the real exchange rate is less than 1; a profit might be made by buying corn in the U.S. and selling it in Mexico. d. the real exchange rate is less than 1; a profit might be made by buying corn in Mexico and selling it in the U.S.
If the federal government imposes a new tax on golf clubs, that tax
A) encourages people to take up golf. B) encourages people to buy more golf balls. C) encourages fewer people to play golf. D) discourages people from switching from playing tennis to playing golf.