Bonita's Braidworks hires workers to braid hair. The store sells the service for $25 per customer. The marginal revenue product of this store?s fifth worker is $50. The marginal product of the fifth worker is
A. 0.5 braided customers.
B. 2 braided customers.
C. 25 braided customers.
D. indeterminate from this information.
Answer: B
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The law of demand says that the lower the price charged for a good, ceteris paribus, the:
a. greater the quantity demanded per period of time. b. greater the demand for the good per period of time. c. smaller the demand for the good per period of time. d. smaller the quantity demanded per period of time. e. larger the supply of the good per period of time.
Suppose the U.S. dollar appreciates in value against the Australian dollar, and the Fed intervenes in the foreign exchange market by using U.S. dollars to buy Australian dollars. The Fed could sterilize the expansionary effect of this intervention by:
a. buying U.S. dollars in the foreign exchange market. b. buying U.S. government bonds in the domestic open market. c. selling Australian dollars in the foreign exchange market. d. selling U.S. government bonds in the domestic open market. e. buying Australian dollars in the foreign exchange market.
According to Coase, the efficient solution to an externality problem depends on which party can avoid the problem at the lower cost. Thus when property rights are assigned to one party or another, the two parties will agree on the efficient solution to an externality problem as long as transaction costs are low, regardless of which party is assigned the property right
Indicate whether the statement is true or false
Which of the following is true?
A. Each Nash equilibrium is a perfect equilibrium. B. In a one-shot game, a collusive strategy always represents a Nash equilibrium. C. Every perfect equilibrium is a Nash equilibrium. D. A perfect equilibrium occurs when each player is doing the best he can regardless of what the other player is doing.