Suppose a firm uses workers and office space to produce output. The firm is locked into a year-long lease on its office space, but it can easily vary the number of employee-hours it uses each day. The accompanying table describes the relationship between the number of employee-hours the firm uses each day and the firm's daily output. Each unit of output sells for $2, the hourly wage rate is $14, and the rent on the office space is $50 per day.Employee-Hours Per DayOutput Per Day0014048091201516023200 This firm's fixed cost each day is:
A. $14.
B. $66.
C. $50.
D. $64.
Answer: C
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The welfare loss associated with the outcome in a colluding oligopoly is:
A. smaller than that of a perfectly competitive outcome. B. smaller than that of a competitive oligopoly. C. the same as that of a perfectly competitive outcome. D. None of these statements is true.
Equilibrium wage will increase if quantity of labor demanded rises
Indicate whether the statement is true or false
Figure 4-16
Assume that Figure 4-16 shows the supply of soda. An increase in the price of syrup used in the production of soda will shift supply from
a.
S1 to S2.
b.
S2 to S1.
c.
S2 to S3.
d.
S1 to S3.
As the price of leather increases
A. the price of leather shoes will decrease. B. the demand for leather shoes will increase. C. the quantity of leather shoes demanded will decrease. D. the supply of leather shoes will increase.