If the private-sector wage of biologists was significantly greater than that of music professors, what might happen if a university tried to pay its entire faculty the same salary?
Those individuals, who are able to command higher wages outside of the university, would likely leave the world of academia to accept positions elsewhere. This would likely result in a shortage of biologists and a surplus of music professors on campus.
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Which of the following is a characteristic shared by a perfectly competitive firm and a monopoly?
A) Each sets a price for its product that will maximize its revenue. B) Each maximizes profits by producing a quantity for which price equals marginal cost. C) Each maximizes profits by producing a quantity for which marginal revenue equals marginal cost. D) Each must lower its price to sell more output.
Following Example 8.8 in the book, the long-run supply of rental housing in most U.S. communities is more inelastic than the long-run supply of owner-occupied housing. Why?
A) Local rental housing regulations B) Limited demand for rental housing C) Limitations on the urban land available for rental housing D) A and C above are correct
Which of these is an advantage of money as a store of value? a. It can generate high interest income
b. It can facilitate hassle-free international exchange. c. It can be easily liquidated. d. It can signal a nation's economic health. e. It can increase potential output.
Suppose for some firm that average total cost is minimized at Q1 units of output. For a monopolistically competitive firm in long-run equilibrium, Q1
a. is also the level of output at which marginal cost equals average total cost. b. exceeds the level of output at which there is a point of tangency between the demand curve and the average total cost curve. c. exceeds the level of output at which marginal revenue equals marginal cost. d. All of the above are correct.