Consider a labor market in equilibrium. If the demand curve shifts to the right while the supply curve shifts to the left, then the wage rate in the market will:
A. increase.
B. decrease.
C. remain unchanged.
D. either increase or decrease or remain unchanged.
Answer: A
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Diseconomies of scale is a result of
A) mismanagement. B) difficulties of coordinating and controlling a large enterprise. C) specialization of labor, capital, and management. D) technological progress. E) larger fixed costs as the firm's production increases.
In the above figure, the relationship between x and y is
A) positive, with slope decreasing as x increases. B) negative, with slope decreasing as x increases. C) negative, with slope increasing as x increases. D) positive, with slope increasing as x increases.
Two software firms have developed an identical new software application. They are debating whether to give the new app away free and then sell add-ons or sell the application at $30 a copy
The payoff matrix is above and the payoffs are profits in millions of dollars. What is the Nash equilibrium of the game? A) Both Firm 1 and 2 will sell the software application at $30 a copy. B) Both Firm 1 and 2 will give the software application away free. C) Firm 1 will give the application away free and Firm 2 will sell it at $30. D) There is no Nash equilibrium to this game.
Because a firm has implicit costs as well as explicit costs
A) its accounting profit is always less than its economic profit. B) its economic profit is usually the same as its accounting profit. C) its economic profit is usually less than its accounting profit. D) its economic profit is usually more than its accounting profit.