If product demand decreases and product price decreases,
A. the marginal revenue product curve will shift to the right.
B. the marginal revenue product curve will shift to the left.
C. the firm will move up the marginal revenue product curve and hire fewer units of the input.
D. the firm will move down the marginal revenue product curve and hire more units of the input.
Answer: B
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Diminishing marginal returns to labor imply that
a. fixed costs will remain constant as the firm's output increases. b. the firm's short-run marginal cost curve will be upward sloping. c. the firm enjoys increasing returns to scale in the long run. d. the firm will be unable to earn short-run economic profit.
Harold, a delivery man, washes and irons his own shirts. Sarah, his boss, sends her clothes to a laundry. Which is the most plausible economic explanation for this difference?
a. Harold must enjoy ironing more than Sarah does. b. Harold must be better at ironing than Sarah is. c. The opportunity cost of ironing is greater for Harold. d. Harold probably has an absolute advantage in ironing. e. Sarah has a higher opportunity cost of laundering her clothes than Harold does.
Technological innovations will cause
a. production to increase but the production possibilities curve to remain unchanged b. the production possibilities curve to shift to the left c. the production possibilities curve to shift to the right d. an economy to operate within its production possibilities curve e. production at a point above or exterior to the production possibilities curve
Which of the following is not an example of a barrier to entry?
a. A soybean farmer is the first in her county to use a new brand of fertilizer. b. Microsoft obtains a copyright for its Windows operating system. c. A pharmaceutical company obtains a patent for a new medication to treat migraine headaches. d. A taxi cab driver in New York City obtains a license to legally provide transportation in New York City.