A firm is currently hiring capital and labor so that MPL/PL > MPK/PK. If the firm wishes to maximize profits it should hire
A. more capital and more labor.
B. more labor and less capital.
C. less labor and more capital.
D. less labor and less capital.
Answer: B
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Stockholders are residual claimants, meaning that they
A) have the first priority claim on all of a company's assets. B) are liable for all of a company's debts. C) will never share in a company's profits. D) receive the remaining cash flow after all other claims are paid.
"More elastic" means
a. unchanging b. less desirable c. more desirable d. less responsive e. more responsive
Foreign aid:
A. provided by developed countries to developing countries represents about 10 percent of the GDP of developed countries. B. is an important source of funding for investment in most developing countries. C. does not contribute much to domestic investment in most developing countries. D. is largely wasted in most developing countries because it comes with no strings attached.
A public good is any good or service that users collectively consume and there is no way to bar free riders
a. True b. False Indicate whether the statement is true or false