What is the difference between a firm's marginal revenue and its marginal revenue product?
A) Marginal revenue is the change in sales revenue from selling one more unit of output while marginal revenue product is the change in total revenue from hiring one more worker.
B) There is no difference between the two terms.
C) Marginal revenue is the increase in revenue when a firm raises its output price while marginal revenue product is the increase in marginal product when a firm hires an additional worker.
D) Marginal revenue is the change in sales revenue from selling one more unit of output while marginal revenue product is the profit earned from hiring one more worker.
A
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The price elasticity of demand is a measure of:
A. the change in quantity demanded of a good that results from a change in its price. B. the demand for a good. C. how consumers respond to excess demand. D. the change in price of a good that results from a change in its quantity demanded.
Two firms, Industrio and Capitalista, have access to five production processes, each of which has a different cost and gives off a different amount of pollution. The daily costs of the processes and the corresponding number of tons of smoke emitted are shown in the table below. Both firms currently use process A, and each emits 4 tons of smoke per day. The government is considering two plans to reduce pollution: requiring both firms to reduce pollution by 25 percent or auctioning pollution permits. Each permit would entitle the owner to emit one ton of smoke per day. Without a permit, no smoke can be emitted.ProcessABCDE(smoke/day)(4 tons/day)(3 tons/day)(2 tons/day)(1 tons/day)(0 tons/day)Cost to Industrio ($/day)$350$400$500$700$1,000Cost to Capitalista
($/day)$225$250$290$400$600 Suppose the government decides to sell 6 permits allowing a total of 6 tons of pollution. The government starts the bidding with an opening price of $30. What happens next? A. A total of five permits will be demanded, forcing the government to lower the price. B. Industrio will purchase all available permits at $30. C. A total of seven permits will be demanded, forcing the government to raise the price. D. Industrio will demand 3 permits and Capitalista will demand 3 permits.
A free agent is a player who
A. can sell his services to the highest bidder. B. is eligible to be drafted. C. is bound to the team he was under contract with the previous year. D. must play for free.
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, Point E necessarily represents
A. only motorcycles being produced. B. overallocation of resources. C. an impossible production point. D. technological advancement.