If an investment offered an expected payoff of $100 with $0 variance, you would know that:
A. half of the time the payoff is $200 and the other half it is $0.
B. half of the time the payoff is $100 and the other half it is $0.
C. the payoff is always $100.
D. half of the time the payoff is $200 and the other half it is $50.
Answer: C
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If the production possibilities frontier is a straight line, then the
A. opportunity cost of producing one good is zero. B. society is capable of producing only one of the goods and not the other. C. producer can produce more of both goods simultaneously. D. law of constant opportunity costs applies.
When leisure is a normal good, the wage elasticity of labor supply is always positive.
Answer the following statement true (T) or false (F)
The price-taker firm should discontinue production immediately if:
A. the market price exceeds the firm's average total costs. B. the market price is less than the firm's average variable costs. C. the market price is less than the firm's average total costs, but greater than its average variable cost. D. its accounting statement indicates that it is suffering losses.
In the United States, antitrust enforcement focuses on
A. the average level of prices charged by firms. B. the price-cost margin of an industry. C. the degree of market concentration within a market. D. the profitability of the leading firms in an industry.