The demand curve for labor of a monopolist
A. slopes upward because monopolists use more capital than do perfectly competitive firms.
B. slopes down because of the law of diminishing marginal product and because the monopolist must lower prices to sell additional units of the good.
C. is horizontal even though the demand curve for labor for a competitive firm is downward sloping.
D. slopes down for the same reason as the demand curve for labor of a perfectly competitive firm.
Answer: B
You might also like to view...
Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher B. expansionary; higher; potential C. recessionary; higher; potential D. recessionary; lower; lower
Explain how an increase in business investment at a constant price level changes equilibrium expenditure
What will be an ideal response?
Price discrimination is based on self-selection:
A. when a firm can distinguish consumers with a high versus low willingness to pay. B. when a firm offers a menu of alternatives, designed so that different customers will make different choices based on their willingness to pay. C. when a monopolist knows perfectly the customer's willingness to pay for each unit its sells and can charge a different price for each unit. D. when monopolists decide for themselves whether to engage in price discrimination.
According to the new classical macroeconomists, each of the following statements is true EXCEPT:
A) Disinflation will be harder to bring about because of the time-inconsistency problem. B) Policymakers are tempted to deviate from the preannounced policy once the public changes its expectations. C) Feedback rules are preferred to discretionary rules. D) Disinflation will be painless if the restrictive policies announced by the government are credible.