Kara and Kyle are competing sockeye salmon fishers. Both have been allocated ITQs that limit their catch to 2,000 tons of sockeye salmon each. Kara's cost per ton is $8; Kyle's cost per ton is $12. Refer to the information given. If the market
price of sockeye salmon is $15 per ton, and Kara and Kyle both catch their quota, their combined profit will be:
A. $6,000.
B. $14,000.
C. $20,000.
D. $30,000.
Answer: C
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What will be an ideal response?
The fact that price and quantity demanded are related negatively illustrates the:
a. law of supply. b. law of quantity supply. c. law of demand. d. law of quantity demanded. e. point that some facts are unobservable.
A monopoly produces widgets at a marginal cost of $8 per unit and zero fixed costs. It faces an inverse demand function given by P = 38 - Q. What are the profits of the monopoly in equilibrium?
A. $345 B. $225 C. $120 D. None of the statements is correct.
Refer to the table below. With diminishing marginal returns, if the firm hires seven units of labor, which of the following numbers would most probably be the total product?
Assume that the only variable resource used to produce output is labor.
A. 40
B. 39
C. 38
D. 37