Always There Wireless is wireless monopolist in a rural area. There are 200 customers, each of whom has a monthly demand curve for wireless minutes of Qd = 200 - 100P, where P is the per-minute price in dollars and Q is the number of wireless minutes. The marginal cost of providing the wireless service is $0.25 per minute. If Always There charges $0.25 per minute, how many minutes will each customer buy each month?
A. 175
B. 200
C. 2
D. 225
A. 175
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A monopsonist that wants to hire more labor must pay more for the new labor than it is currently paying and increase the wage rate of all existing employees because
A) the demand curve for labor is inelastic. B) of labor unions. C) the supply of labor is upward sloping. D) of competition in the labor market.
If government policy makers were worried about the inflationary potential of the economy, which of the following would be a correct fiscal policy change? a. Decrease consumption taxes
b. Decrease government purchases of goods and services. c. Increase government purchases. d. None of the above.
American Airlines makes numerous nonstop flights from Chicago's O'Hare Airport to the airport at Dallas-Fort Worth. The distance between those two cities is 1,000 miles. The only variable cost, fuel, costs $.06 for each passenger-mile it flies. Bob, on his way to an emergency business meeting, buys a ticket in coach class for $1,300 at the very last minute. The marginal cost of flying Bob from
Chicago to Dallas-Fort worth is a. $1300 b. higher than the average cost of previous passengers c. $600 d. $160 e. $60
Full-cost transfer-pricing frequently:
A. understates the opportunity costs of external transfers. B. understates the opportunity costs of internal transfers. C. overstates the opportunity costs of internal transfers. D. overstates the opportunity costs of external transfers.