A firm is considering three projects. Each costs $1 million now. Project A will yield $400,000 a year for three years, beginning one year from now. Project B will yield $1.25 million three years from now, and Project C will yield $600,000 for two years,
beginning two years from now. If the interest rate is 8 percent, which of these projects should the firm undertake?
A) Project A
B) Project B
C) Project C
D) none of these
Answer: A
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If regulators require a monopoly to earn zero economic profit, the monopoly will produce the quantity where
a. the marginal cost curve crosses the average cost curve. b. the marginal cost curve crosses the demand curve. c. the average cost curve crosses the demand curve. d. the marginal cost curve crosses the marginal revenue curve.
Which of the following is TRUE of trends in the number of new U.S. patents?
A) There was a steady increase in new patents throughout the 1970s. B) The number of new patents granted each year has remained unchanged since the early 1970s. C) The number of new patents granted each year declined by more than 50 percent after 2001. D) There was a surge in new patents in the latter part of the 1990s.
If it is a cultural norm to practice an afternoon "siesta" (nap), it is likely that the labor:
A. supply in that culture would be relatively lower at any wage. B. demand in that culture would be relatively lower at any wage. C. supply in that culture would be relatively greater at any wage. D. demand in that culture would be relatively greater at any wage.
The correlated random effects approach cannot be applied to models with many time-varying explanatory variables.
Answer the following statement true (T) or false (F)