If the least-cost input combination doesn't include all inputs, it's called:
A. a boundary solution.
B. an incomplete solution.
C. an interior solution.
D. an efficient solution.
A. a boundary solution.
You might also like to view...
In the African nation of Senegal, to enroll in school a child needs a Birth Certificate that costs $25 . This price is several weeks' income for many families. Explain how this requirement is likely to affect the growth of human capital in Senegal
What will be an ideal response?
For an inferior good, if the income effect more than offsets the substitution effect, we call that good
A) a Giffen good. B) a normal good. C) an inferior good. D) a neutral good.
A nondiscriminating monopolist earning positive short-run economic profit determines that its current marginal cost is $15 and its current marginal revenue is $20 . To maximize profit, a firm should
a. raise price and increase output b. raise price and decrease output c. maintain a constant price and increase output d. reduce price and increase output e. shut down
The real balance effect (wealth effect), the interest rate effect, and the net exports effect all help to explain the:
a. decrease in supply in the loanable funds market. b. large federal budget deficit. c. increase in short-run aggregate supply. d. downward-sloping aggregate demand curve.