When a pharmaceutical firm spends millions of dollars to lobby and convince Congress to extend the number of years a firm is awarded patent protection, then the pharmaceutical firm is engaging in:
A. rent seeking.
B. fraud.
C. price discrimination.
D. marginal cost pricing.
Answer: A
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Blowdryer businessman Max Power is starting a new hairdryer business. Max estimates his production function to be q = KL0.5. Max has 60 units of capital (K = 60 ). Derive Max's MP and AP of labor for the current level of capital
What will be an ideal response?
In the case of a beneficial externality
a. marginal private cost is below marginal social cost. b. marginal social cost is above marginal private cost. c. marginal social cost and marginal private cost are equal. d. the free market price is below the socially efficient price.
Laws that change the tax code must begin
A. with the President. B. in the House of Representatives. C. in the Senate. D. none of these, they may begin anywhere.
When adding another unit of labor leads to an increase in output that is smaller than the increases in output that resulted from adding previous units of labor, the firm is experiencing
a. diminishing labor. b. diminishing output. c. diminishing marginal product. d. negative marginal product.