If a firm's labor input response to a decrease in the wage differs between the short and the long run, we know that more workers will be hired after the initial short run adjustment.
Answer the following statement true (T) or false (F)
True
Rationale: See Graph 13.9 in the text -- short run labor demand curves are always steeper than long run labor demand curves (unless they are the same).
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An unregulated, single-price monopoly is shown in the figure above. If its fixed cost is $20, the monopoly's total economic profit when it is maximizing its profit will be
A) negative. B) $0. C) $25. D) $50.
A person's marginal tax rate equals
a. her tax obligation divided by her average tax rate. b. the increase in taxes she would pay as a percentage of the rise in her income. c. her tax obligation divided by her income. d. the increase in taxes if her average tax rate were to rise by 1percent.
A farmer notices that a neighboring rancher's cattle are wandering and destroying some of his crops. The farmer decides to offer a payment to the rancher if the rancher will reduce the size of his herd. By doing so, the farmer
A) can be sure that the size of the herd will be reduced and the size of his own harvest will be increased. B) indicates to the rancher that there is an opportunity cost to the wandering of the cattle, and thereby internalizes the externality. C) inadvertently bears the costs of the externality when the rancher should be liable for the costs. D) informs the rancher that the cattle have destroyed crops, which should induce the farmer to build a fence in order to maintain good relations.
To be accepted as money, an item must perform all of the following functions EXCEPT
A. be easily reproduced. B. be a medium of exchange. C. serve as a store of value. D. serve as a standard of deferred payment.