If the nominal rental price of capital divided by the price of output is less than the marginal product of capital, a firm that wishes to maximize profits will
A) purchase more capital goods.
B) purchase fewer capital goods.
C) maintain the current level of capital goods.
D) allow capital goods to wear out without purchasing additional capital goods.
A
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Using the data in the table above, if the price of a stapler is $8, then there is ________ of staplers, and the quantity of staplers demanded ________ the quantity of staplers supplied
A) a surplus; is greater than B) a surplus; is less than C) a shortage; is greater than D) a shortage; is less than E) neither a surplus nor a shortage; equals
Suppose The United Bank of Glassen has loaned $250 to Mr. Joseph Langdon for his business. Mr. Langdon repays the loan with a check written against his own bank, Rexan Bank. Which of the following is likely to happen as a result of this transaction? a. The reserves at the United Bank of Glassen will fall
b. The reserves at Rexan Bank will increase. c. Checkable deposits at Rexan Bank will increase. d. Rexan Bank will make more loans than before. e. The reserves and checkable deposits of Rexan Bank will decrease.
Which of the following cost functions exhibits economies of scope over the specified output range?
A. C(Q1, Q2) = 10 + 0.5Q1Q2 + (Q1)2 + (Q2)2, for all Q1 < 3 and Q2 < 3. B. C(Q1, Q2) = 10 + 0.5Q1Q2 + (Q1)2 + (Q2)2, for all Q1 > 2 and Q2 > 2. C. C(Q1, Q2) = 10 + 3Q1Q2 +(Q1)2 + (Q2)2, for all Q1 > 4 and Q2 > 4. D. C(Q1, Q2) = 10 + 3Q1Q2 + (Q1)2 + (Q2)2, for all Q1 > 0 and Q2 > 0.
If you know that you can afford a $500 per month car payment for the next 48 months, the interest rate is positive, and you have found a car dealer who will agree to a zero down payment, you will
A. be able to afford something less than a $24,000 car. B. be able to afford a $24,000 car (which is exactly $500 × 48). C. be able to finance a more expensive car when the interest rate is high. D. be able to afford a $25,000 car (which is more than $500 × 48).