An increase in supply is caused by:
A) an increase in resource prices.
B) suppliers' expectations of higher prices in the future.
C) an increase in the price of a good using the same resources.
D) a decrease in the price of a good using the same resources.
Ans: D) a decrease in the price of a good using the same resources.
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A firm can minimize cost by
A) picking the bundle of inputs where the lowest isocost line touches the isoquant. B) picking the bundle of inputs where the isoquant is tangent to the isocost line. C) picking the bundle of inputs where the last dollar spent on one input gives as much extra output as the last dollar spent on any other input. D) All of the above.
An inferior good is
a. any good of low quality b. one that consumers buy less of at a higher price c. one that consumers buy less of as their income rises d. one that has few substitutes e. any good made with inexpensive labor
The production function of a firm illustrates the relationship between the amount of labor hired and output
a. True b. False Indicate whether the statement is true or false
Which of the following statements regarding people's wants is true?
A. Over time, people's wants tend to be stable and constant B. As people consume more products, their wants will be reduced C. Intangible serves, like tangible goods, may satisfy people's wants D. People's wants do not include their basic needs