If marginal revenue for a firm is negative,
a. marginal cost must also be negative
b. total revenue will decrease if the firm sells more output
c. total revenue must also be negative
d. the firm should shut down in the short run
e. the lost revenue from having to lower its price is less than the additional revenue from higher sales
B
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If a production technology has diminishing marginal product of all inputs throughout, then the producer choice set is convex.
Answer the following statement true (T) or false (F)
Say's law states that
A. desired expenditures will equal actual expenditures. B. demand is always less than supply. C. people produce only the goods they want. D. overproduction is never possible because of limited resources.
If labor costs are 60 percent of production costs, then a 15 percent increase in wage rates would increase production costs by:
A. 60 percent B. 45 percent C. 15 percent D. 9 percent
Joe's income is $500, the price of food (F, y-axis) is $2 per unit, and the price of shelter (S, x-axis) is $100. Which of the following represents his marginal rate of transformation of food for shelter?
A) -5 B) -50 C) -.02 D) None of the above.