The exiting of firms from a perfectly competitive industry occurs when
A. P = ATC.
B. accounting profit is less than economic profit.
C. MR equals MC.
D. opportunity costs cannot be covered.
Answer: D
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Which of the following decreases the supply of restaurant meals?
A) Waiters get a pay raise. B) Consumers' incomes increase and restaurant meals are a normal good. C) Consumers' incomes decrease and restaurant meals are a normal good. D) The price of movies, a complement to restaurant meals, falls.
The above table shows the short-run production function for Albert's Pretzels. The marginal product of labor for the third worker is
A) 6. B) 8. C) 24. D) not known from the information provided.
If Firm A and Firm B are playing a finitely repeated game in which they both believe there is a 90 percent chance that the game will continue each period, all of the following are true except which one?
A) There is not an end-game problem. B) Both firms can earn higher profit by cooperating. C) Both managers will worry about punishment from cheating. D) Tacit collusion is not possible.
When technology spillover occurs,
a. it is the government's responsibility to own firms that are engaged in high-tech research. b. a firm's research yields technological knowledge that can then be used by society as a whole. c. those firms engaged in technology research should be taxed by the government. d. firms invest in the latest production technology and the cost of that technology "spills over" to the prices consumers must pay for the product.