Joe runs a business and needs to decide how many hours to stay open. Figure 2.2 illustrates his marginal benefit of staying open for each additional hour. Suppose that Joe's marginal cost of staying open per hour is $24
How many hours should Joe stay open?
A) 3 hours B) 4 hours C) 5 hours D) 6 hours
D
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To attract more bidders, and more aggressive bidders, to your auction
a. withhold relevant information about the value of the object b. don't allow bidders to know how others are bidding c. do not allow potential bidders to examine the object too closely d. hold oral auctions
Which of the following items is most likely to be an implicit cost of production?
a. the "competitive rate" salary the owner of the business pays herself for services provided b. property taxes on a building owned by the firm c. rental payments for a building utilized by the company and rented from another party d. the interest income foregone on the equity capital invested by owners
Answer the following statements true (T) or false (F)
1) When each firm uses the strategy that maximizes its profit, it is possible for the equilibrium result to yield the worst possible joint equilibrium for all firms. 2) If Best Lights and Bright Lights are competing in a duopoly, Best Lights' profit depends solely on the decisions of its managers. 3) Every dominant strategy equilibrium is a Nash equilibrium, but not every Nash equilibrium is a dominant strategy equilibrium. 4) Cheap talk helps firms cooperate and earn higher profit. 5) If two players are in a finitely repeated game and both players know the final period, cooperation is not possible due to the end-period problem.
If the wage rate rises, labor's share in the total costs of a production process
a. will increase. b. will decrease. c. may increase or decrease depending on the elasticity of demand for the product. d. may increase or decrease depending on the ease of substitution of other inputs for labor.