Holding other factors constant, an increase in the capital stock ________ the real wage and ________ employment.
A. increases; increases
B. decreases; increases
C. increases; does not change
D. increases; decreases
Answer: A
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Refer to Scenario 5.8. The value to Icarus Airlines of complete information is
A) $40 million. B) $90 million. C) $115 million. D) $120 million. E) $125 million.
If a firm's demand is subject to random fluctuations, the firm's ________ will also be random.
A) marginal revenue B) average total cost C) average variable cost D) marginal cost
The two tendencies of a firm in a cartel are the incentive to:
a. cheat to maximize joint profits and the incentive to raise prices. b. cheat and avoid collusion and the incentive to raise price to maximize the firm's share of profits. c. increase output in order to minimize per-unit cost and the incentive to reduce price in order to maximize joint profit. d. cooperate to maximize joint profits and to cheat on the agreement in order to increase the firm's share of the profit.
In a command system, the decision about what should be produced is made by
a. a central authority b. the market c. repeating what was done in the past d. business firms e. consumers