The manager of Fatty Foods is thinking about retiring. He has two options: to leave his stores as a company stores, to be managed by a salaried manager, or to sell some of them as franchises. He however has no way of monitoring the salaried managers' activities. What would be his best bet?
a. Let the stores stay company stores
b. Sell them off as franchises
c. Shut down the business completely
d. Never retire
b
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University studies have shown that that chickens grow 2 percent larger when a red mitten is placed in their cage and Vivaldi is played in the coop. This leads to a reduction in feed costs of $60 million a year. In the chicken market, the
A. demand curve shifts to the right. B. supply curve shifts to the right. C. price will rise. D. quantity sold will fall.
If all consumers are price-takers facing the same prices, then all choice sets are the same.
Answer the following statement true (T) or false (F)
Market failures
A. prevent the price system from attaining economic efficiency. B. encourage businesses to produce more of a good than they really want to. C. encourage people to purchase more of a good than they really want. D. are usually caused by government interference in the economy.
Refer to the given data. Suppose that the union that provides labor to firms in this market successfully negotiates an increase in the wage rate from $8 to $10. As a result of the wage increase, firms will hire:
A. fewer workers and the total paid out for wages will decline.
B. fewer workers, but the total paid out for wages will increase.
C. fewer workers, but the total paid out for wages will remain unchanged.
D. more capital, if capital and labor are used in fixed proportions in production.