The labor supply curve
a) slopes upward if the income and substitution effects of a wage increase exactly offset each other
b) is vertical if the income effect of a wage increase is dominant
c) is downward-sloping if the income effect of a wage increase is dominant
d) is vertical if the substitution effect of a wage increase is dominant
e) is horizontal in the long run
c) is downward-sloping if the income effect of a wage increase is dominant
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Suppose a monopolist sells in two distinct markets. The demand and marginal revenue for the first market are given by P1 = 240 - 2Q1 and MR1 = 240 - 4Q1, respectively, where Q1 is the quantity demanded and P1 is the price paid by the first group. The demand and marginal revenue for the second market are given by P2 = 120 - Q2 and MR2 = 120 - 2Q2, respectively, where Q2 is the quantity demanded and P2 is the price paid by the second group. The monopoly's marginal cost is given by MC = 4/9 Q, where Q is the total output produced by the monopoly.
(i) How much does the monopoly supply in each market and what price does it charge? (ii) What is the common equilibrium value of marginal revenue and marginal cost? (iii) Use your answers to parts i and ii to calculate the elasticity of demand for each market.
Answer the following statement(s) true (T) or false (F)
1. The largest “hole” in the earth’s ozone layer occurs over North America. 2. Scientists agree that the presence of chlorofluorocarbons (CFCs) in the atmosphere most likely explains the existence of the ozone hole. 3. The release of CFCs associated with the production of refrigeration units is an example of a negative externality. 4. The Kyoto Protocol banned the use of CFCs. 5. CFC allowance trading was an integral part of achieving the objectives of the Montreal Protocol.
Refer to Table 3.2, which shows some costs and benefits of having your car repaired. Suppose you use your car to deliver pizzas. If your wage increases from $10 to $20 per hour, what happens to your best choice of hours to spend on car repairs?
A. It increases by 1 hour.
B. It decreases by 1 hour.
C. It doesn't change.
D. It decreases by 2 hours.
Suppose that you can schedule a worker for up to 4 hours per day. The total benefit and total cost functions are B(H) = 1,300H - 20H2 and C(H) = 500H + 60H2. The corresponding formulas for marginal benefit and marginal cost are MB(H) = 1,300 - 40H and MC(H) = 500 + 120H. For how many hours should you schedule the worker?
A. 11.25 hours B. 2.5 hours C. 5 hours D. 0 hours