If a farmer’s opportunity cost of producing 50,000 bushels of wheat is 20,000 fewer bushels of soybeans, then his or her opportunity cost of producing 50,000 bushels of soybeans must also be 20,000 fewer bushels of wheat.
Answer the following statement true (T) or false (F)
False
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The cross elasticity between computers and software is
A) negative because they are substitutes. B) positive because they are substitutes. C) negative because they are complements. D) positive because they are complements. E) positive because they are normal goods.
Suppose the required reserve ratio is 20 percent. If banks are conservative and choose not to loan all of their excess reserves, the real-world deposit multiplier is
A) less than 5. B) equal to 5. C) greater than 5. D) equal to 20.
A monopolist faces a demand curve Q = 120 - 2p and has costs given by C(Q) = 20Q + 100
a. Write the monopolist's profits in terms of the price it charges. b. Use the derivative (w.r.t. price) to determine the monopolist's profit-maximizing price. c. Now, derive the monopolist's inverse demand based on the demand equation above. Write out the monopolist's profits in terms of quantity. d. Use the derivative w.r.t. Q to determine the monopolist's optimal quantity. What price does the monopoly charge?
The smallest component of national income is
A. rent. B. interest. C. profits. D. salaries and wages.