Suppose a publisher faces the following costs of producing 10,000 newspapers each month: $5,500 cost of labor; $2,200 monthly mortgage payment; $250 cost of electricity to run the printing presses; $800 for ink and paper; and $200 in city property taxes (based on the value of the building and land). Its total variable costs are
a. $8,950
b. $8,750
c. $6,550
d. $6,300
e. $5,500
C
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The figure illustrates the market for chairs. If the supply of chairs increases, the price of a chair ________ $40 and the quantity ________
A) will rise above; demanded will decrease B) will rise above; supplied will increase C) will fall below; demanded will increase D) will fall below; demanded will decrease
Consider budget constraints A and B in the graph shown. The slope of A compared to the slope of B:
A. is steeper, showing that movie tickets are relatively more expensive in line A.
B. is flatter, showing that books are relatively less expensive in line A.
C. shows that the opportunity cost of books is smaller in line A.
D. shows that the opportunity cost of books is greater in line A.
Which of the following questions would require normative analysis?
a. What will be the effect of a 3 percent increase in the price of cucumbers? b. How many cucumbers should be supplied if the price increases by 3 percent? c. Will the sale of cucumbers decrease significantly? d. How will the sale of organic and non-organic cucumbers compare next month?
Given two economic systems, A and B, if economy A has a comparative advantage in the production of widgets, then
A. economy A would not benefit from the specialization of production. B. economy A must give up less of all other goods to produce widgets than economy B. C. economy A is less efficient in the production of some goods than economy B. D. the inputs necessary to produce widgets in economy A cost less than in economy B.