A firm should hire an additional worker as long as the wage rate is
A. Greater than the MRP.
B. Less than the MPP.
C. Less than or equal to the MRP.
D. Greater than the MPP.
Answer: C
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Under a system of barter
A) each individual trades output directly with another. B) only agricultural goods may be traded. C) goods may be traded for money, but money may not be traded for goods. D) currency is accepted for purchases, but personal checks are not.
A market with a negative externality
a. will be regulated by the government b. is an example of a natural monopoly c. will be Pareto efficient, as long as bargaining costs are high enough d. will produce less than the efficient quantity, thereby creating a welfare loss e. will produce more than the efficient quantity, thereby creating a welfare loss
A profit-maximizing perfectly competitive firm must decide:
A. only on which industry to join, taking price and output as fixed. B. both what price to charge and how much to produce. C. only on how much to produce, taking price as fixed. D. only on what price to charge, taking output as fixed.
If the United States is to reduce poverty by using a negative income tax, the guaranteed income should be
A. two times the tax rate. B. close to the poverty line. C. close to the median income of all families. D. above the poverty line.