The accompanying figure shows the production possibilities curve for the island of Genovia:
If 500 cars are produced in Genovia, a maximum of ________ tons of agricultural products can be produced.
A. 45,000
B. 50,000
C. 25,000
D. 40,000
Answer: C
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Sam Lewis owns a firm in New York City's garment district. If Sam keeps adding workers to use the same number of sewing machines, eventually the workplace will become so crowded that workers will get in each other's way. At this point
A) Sam should begin using a division of labor in his business. B) Sam's business will be in violation of safety rules that have been established by the New York City government. C) the marginal product of labor in Sam's business would be negative and his total output would decrease. D) Sam should encourage his workers to share their sewing machines.
A shock that could trigger a recession is a
a. large military buildup b. large increase in the price of oil c. sudden unexplained increase in consumption d. new technological breakthrough e. large decrease in the price of oil
___________ include all spending on labor, machinery, tools, and supplies purchased from other firms
a) Total revenue b) Total profits c) Average profit margin d) Total cost
Average variable and average total costs get farther apart as output decreases because ________ as output decreases.
A. total and total variable costs get farther apart B. diminishing returns set in C. marginal costs increase D. average fixed costs increase