Suppose the production function for T-shirts can be represented as q = L0.25K0.75. Show that the isoquants for this function are convex
What will be an ideal response?
The slope of the isoquant is -MPL/MPK = -K/3L. As L increases and K decreases, this value becomes absolutely smaller implying a flatter slope.
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"If country A has a higher level of real GDP per person than country B, then people in Country A must enjoy a higher standard of economic welfare than people in Country B." Is this statement true or false and explain your answer
What will be an ideal response?
Which of the following is an example of a negative externality?
a. planting flowers in your front yard b. talking loudly when others are trying to study economics c. people donating money to charity d. the price of bread increases e. denting your neighbor's car fender while backing out of your driveway
In housing market rent serve the purpose of
A) making landlords rich. B) rationing the availability of existing housing. C) providing an entry by the government into the housing market. D) increasing tax collections by the community.
Related to the Economics in Practice on page 10: A study on the effect of roommates on college grades found that there were strong roommate effects on grade point average, effort in school, and fraternity membership. Which of the following is an example of a normative statement concerning this study?
A. In order to maintain a high grade point average, students should only choose roommates who have a high grade point average. B. The effects of roommates on grade point average are strong. C. The effects of roommates on effort in school are strong. D. The effects of roommates on fraternity membership are strong.