Suppose that the price of labor, the only variable input needed to produce cotton, increases from $100 day to $120 day. The effect on costs will be
a. a parallel shift in the total cost curve.
b. a parallel shift in the fixed cost curve.
c. a parallel shift in the marginal cost curve.
d. a shift in total cost by different amounts for different quantities.
d. a shift in total cost by different amounts for different quantities.
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________ could result in a recession because it would ________
A) An increase in government expenditures on goods and services; shift the AD curve to the right. B) An increase in the quantity of money; shift the AS curve to the right. C) An increase in investment; shift the AD curve to the right. D) A tax cut; shift the AS curve to the left. E) A rise in the price of oil; shift the AS curve to the left.
A structured and simplified version of reality that can be used to explain real-world behavior is called
A) an economic model. B) a rationality assumption. C) a postulate. D) a normative alternate reality.
What is the primary function of a bank? Why do people prefer banks over other financial intermediaries?
Education raises wages because the demanders of labor
a. are willing to pay more for highly educated workers who have higher marginal products and the suppliers of labor are willing to pay the cost of becoming educated only if they are rewarded. b. are willing to pay the cost of becoming educated only if they are rewarded and the suppliers of labor are willing to pay more for highly educated workers who have higher marginal products. c. require fewer workers if they are highly educated. d. None of the above is correct.