A firm faces the following relationship between the real wage it pays and the effort exerted by its workers.
The marginal product of labor for this firm is given by MPN = E (50 - N)/3. The firm will choose to pay a wage such that the effort level is
A. 14.
B. 27.
C. 32.
D. 20.
Answer: B
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Answer the following statement(s) true (T) or false (F)
1. A negligence standard, with the allowance of contributory negligence, always leads to a socially optimal outcome. 2. Strict liability is the liability that exists when it can be proven beyond a reasonable doubt that the defendant was negligent. 3. Negligence is irrelevant when a strict liability standard is applied. 4. The principle of general average gives a ship's captain an incentive to consider the value of cargo when jettisoning it to prevent a disaster. 5. The doctrine of Respondent Superior contends that an employer is sheltered from torts committed against his employees.
If there is an exogenous increase in investment spending, Monetarists argue that there would be little or no effect on real output because the interest rate would __________,
investment would __________, saving would __________, and consumption would __________. A) decline; increase; increase; decrease B) decline; increase; decrease; increase C) rise; decrease; decrease; increase D) rise; decrease; increase; decrease
A monopoly will produce the same quantity of output as an otherwise similar perfectly competitive market if
a. it is a perfect price discriminator b. it corners the market c. barriers to entry are high enough d. resource suppliers have market power too e. price is greater than average total cost
A market that operates outside the legal system, either by selling illegal goods or by selling goods at illegal prices is referred to in economics as a
a. gray market. b. resource market. c. black market. d. criminal market.