An externality is
a. a cost of a transaction that is borne by a third party
b. a benefit of a transaction that is enjoyed by a third party
c. a cost or benefit that arises when market price changes
d. any cost or benefit of a transaction that is not accounted for in the market price
e. the external revenue generated by a firm
D
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A firm producing ink pens reports the following production information:
# of Workers Total Product (boxes of pens per hour) 0 0 1 45 2 80 3 100 4 116 5 126 6 131 The pens sell in a competitive market at a price of $0.50 per box. The firm hires workers in a competitive labor market at a wage of $9 per hour. How many workers should the firm hire? Explain your answer.
If fixed cost at Q = 100 is $130, then
a. fixed cost at Q = 0 is $0 b. fixed cost at Q = 0 is less than $130 c. fixed cost at Q = 200 is $260 d. fixed cost at Q = 200 is $130 e. it is impossible to calculate fixed costs at any other quantity
How is the optimal level of input usage to produce a certain output identified with the help of isocosts and isoquants?
Which of the following is not a tool of monetary policy?
a. open market operations
b. reserve requirements
c. changing the discount rate
d. increasing the government budget deficit