Refer to the above table. Suppose the price of the good sold is $3 and the marginal factor cost of labor is $300, how many units of labor will the firm hire?
A. 6
B. 4
C. 3
D. 5
Answer: D
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Weak instruments are a problem because
A) the TSLS estimator may not be normally distributed, even in large samples. B) they result in the instruments not being exogenous. C) the TSLS estimator cannot be computed. D) you cannot predict the endogenous variables any longer in the first stage.
If the government institutes an investment tax credit and decreases income taxes,
a) real GDP falls, and the price level could rise, fall, or stay the same. b) real GDP and the price level fall. c) real GDP rises, and the price level could rise, fall, or stay the same. d) real GDP and the price level rise.
Using the expenditure approach, gross domestic product equals:
A. gross national product. B. the sum of consumption, investment, government purchases. C. the sum of consumption, investment, government purchases, and net exports. D. gross national product minus net exports.
Firms will sometimes not raise their prices, even when there is a large increase in demand for their products because they fear consumers will consider the price increases unfair.
a. true b. false