Which of the following is an explicit cost of production?
A. the electric bill
B. wages paid to workers
C. purchases of raw material
D. Only answers A and B are explicit costs because the purchases of raw material is only an opportunity cost.
E. Answers A, B, and C are all
Ans: E. Answers A, B, and C are all
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Which of the following will most likely happen when better technology is used in production?
A) an upward movement along the production possibilities curve B) an outward shift of the production possibilities curve C) an inward shift of the production possibilities curve D) a downward movement along the production possibilities curve
The most important determinant of price elasticity of supply is
A) the number of close substitutes there are for the good. B) the time period firms have to adjust to the new price. C) the price of the good. D) the importance of the good in the budgets of consumers.
The elasticity of resource demand measures the:
A. responsiveness of workers to changes in wage rates. B. responsiveness of producers to changes in resource prices. C. ratio of marginal revenue product to resource price. D. sensitivity of marginal revenue product to changes in product price.
A headline reads "Lumber Prices Up Sharply." In a competitive market, this situation would lead to a(n):
A. Increase in the price and quantity of new homes B. Decrease in the price and quantity of new homes C. Increase in the price of new homes and decrease in quantity D. Decrease in the price of new homes and increase in quantity