The return to any factor of production that is in fixed supply is called
A. marginal product.
B. pure rent.
C. demand.
D. economic profit.
Answer: B
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What will be an ideal response?
If profit regulation is used to control a natural monopolist, the monopolist is likely to
A. Reduce maintenance of plants and equipment. B. Increase the quality of its product in an effort to increase sales. C. Attempt to reduce the costs of production. D. Inflate or pad the costs of production.
Supporters of Federal Reserve independence contend that independence from the rest of the federal government leads to lower
A) inflation rates. B) interest rates. C) reserve requirements. D) rates of unemployment.
The scale economies index (SCI) is equal to:
A) the cost-output elasticity. B) one minus the cost-output elasticity. C) 100 times the degree of economies of scope (SC). D) marginal cost divided by average cost.