Economic models suggest that movie stars have salaries that
a. greatly exceed their marginal contribution to the movie studio's revenue.
b. understate their full contribution to the movie studio's revenue-as the celebrities are the main reason that people go to see movies.
c. are about equal to their marginal revenue products.
d. can only be explained by looking at specific movie stars and their individual salaries.
C
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Explain why GDP per capita varies among countries even though countries eventually converge to their balanced growth paths
What will be an ideal response?
Refer to Figure 9.8. Under free trade in sugar, domestic producer surplus will be
A) $100. B) $175. C) $10,000. D) $25,000. E) $30,625.
The investors who bought mortgage-backed securities just before the housing bubble burst:
A. were not concerned about the original mortgage. B. were all very comfortable assuming high-risk assets. C. were not confident in the rising home value underlying each mortgage. D. knew exactly what they were buying.
Eventually, external debt must be repaid with the export of real goods and services.
Answer the following statement true (T) or false (F)