A perfectly elastic demand curve implies that the firm:
A. must lower price to sell more output.
B. can sell as much output as it chooses at the existing price.
C. realizes an increase in total revenue that is less than product price when it sells an extra
unit.
D. is selling a differentiated (heterogeneous) product.
Answer: B
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A firm that backward vertically integrates
A) moves downstream in the production process. B) requires that the production process be relatively simple. C) has to merge with another firm. D) may be producing its own inputs.
Economic analysis indicates minimum wage legislation has
a. made it possible for any teenager who wants to work to earn almost 80 percent as much as an adult. b. made it easier for teenagers to find jobs that offer the opportunity for training. c. been an important source of increases in income since most workers earn at or near the minimum wage. d. reduced the on-the-job training opportunities available to teenagers.
The opportunity cost of any decision is the forgone value of the next best alternative that is not chosen
a. True b. False Indicate whether the statement is true or false
Critics of the minimum wage argue that
a. labor demand is inelastic so firms can adjust production. b. too many older employees benefit at the expense of teenage workers. c. many minimum-wage earners are teenagers from middle-class families. d. All of the above are correct.