Suppose a firm uses workers and office space to produce output. The firm is locked into a year-long lease on its office space, but it can easily vary the number of employee-hours it uses each day. The table below describes the relationship between the number of employee-hours the firm uses each day and the firm's daily output. Each unit of output sells for $2, the hourly wage rate is $14, and the rent on the office space is $50 per day.Employee-HoursPer DayOutputPer Day0014048091201516023200When the firm uses 9 employee-hours, its total labor cost each day is:
A. $30
B. $126
C. $56
D. $84
Answer: B
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The above figure shows a monopolistically competitive firm. The figure
A) is only a short-run illustration because the firm is making an economic profit. B) could be either a short-run or long-run illustration because monopolistically competitive firms can make an economic profit in the long-run. C) is only a long-run illustration because the firm is making zero economic profit. D) is neither a short- nor a long-run illustration.
Which of the following will most likely happen when better technology is used in production?
A) an upward movement along the production possibilities curve B) an outward shift of the production possibilities curve C) an inward shift of the production possibilities curve D) a downward movement along the production possibilities curve
Other things the same, if reserve requirements are increased, the reserve ratio
a. increases, the money multiplier increases, and the money supply increases. b. increases, the money multiplier decreases, and the money supply decreases. c. decreases, the money multiplier increases, and the money supply increases. d. decreases, the money multiplier decreases, and the money supply increases.
Inferior goods are always substandard.
Answer the following statement true (T) or false (F)