A monopolist faces a market demand curve with a constant elasticity of -2. The monopoly's production function is Q = 4L and its output price is given by p. What is the monopoly's marginal revenue product of labor function?
A) MRPL = 2p
B) MRPL = 4p
C) MRPL = 10 - 2p
D) MRPL = 5 + 3.5p
B
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If a competitive firm cannot earn profit at any level of output during a given short-run period, then which of the following is LEAST likely to occur?
A) It will shut down in the short run and wait until the price increases sufficiently. B) It will exit the industry in the long run. C) It will operate at a loss in the short run. D) It will minimize its loss by decreasing output so that price exceeds marginal cost.
An increase in unemployment insurance benefits will:
A. increase the demand for labor. B. decrease job search efforts of unemployed workers. C. increase job search efforts of unemployed workers. D. decrease the demand for labor.
Refer to the information. The multiplier for this economy is:
A. 2.
B. 2.5.
C. 3.
D. 4.
A statement that argues that "if taxes on gasoline increase, gasoline consumption will decrease" is an example of what kind of statement?
A) a marginal statement B) a macroeconomic statement C) a normative statement D) a positive statement E) a statement that violates rational choice