Firms will invest in new equipment whenever:
A. the expected cost of the equipment is less than the expected benefit.
B. the expected cost of the equipment exceeds the expected benefit.
C. public saving is greater than private saving.
D. the expected cost of the equipment is greater than the value of the marginal product of the equipment.
Answer: A
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We are investigating the relationship among three variables. We have graphed two of them. Suppose that the variable that is not measured on the x-axis or the y-axis changes. Then, there is
A) no impact on the plotted curve because the variable is not measured on either of the axes. B) a violation of the absence of trend assumption. C) a shift in the plotted curve. D) a movement along the plotted curve. E) an omitted variable.
The law of diminishing marginal utility says that
a. as more of a good is consumed, total utility diminishes causing marginal utility to diminish as well b. as more of a good is consumed, total utility increases causing marginal utility to diminish c. with reference to consumption, more is better than less until a point is reached after which less is better than more d. with reference to consumption, less is better than more until a point is reached after which more is better than less e. we always value the "one before the last one" more
One of the most obvious clues to the relative scarcity of a product is
A) the limited selection of colors. B) the quality of the product. C) the variations in available sizes. D) its current market price.
Marginal revenue product for a price taker equals
a. MP ? P b. MP/MRC c. MP ? MRC d. MRC/MP e. MP/P