Refer to the diagrams. The firm:
A. has a principal-agent problem.
B. has a constant marginal resource cost of $5.
C. has a marginal resource cost that exceeds the wage rate for each worker.
D. will fail to maximize profits if it hires 5 workers.
B. has a constant marginal resource cost of $5.
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The above figure shows Jane's budget line and two of her indifference curves. Which of the following happens to Jane's budget line if the price of a steak dinner fell?
A) It would rotate inward around the vertical intercept, 10 lobster dinners. B) It would rotate outward around the vertical intercept, 10 lobster dinners. C) It would rotate inward around the horizontal intercept, 20 steak dinners. D) It would rotate outward around the horizontal intercept, 20 steak dinners.
The Smoot-Hawley Tariff Act of 1930 has generally been associated with
A) falling tariffs. B) free trade. C) intensifying the worldwide depression. D) recovery from the worldwide depression. E) non-tariff barriers.
If grades are to be a successful signal to potential employers of a student's qualities, then higher grades must be
A) easier for high-productivity students to earn than for low-productivity students to earn. B) easier for low-productivity students to earn than for high-productivity students to earn. C) easy for employers to check. D) used for all future promotions within the firm. E) often referred to in the hiring process.
The current Social Security system works to the disadvantage of blacks primarily because the
a. average annual earnings of blacks are generally lower than other groups. b. average life expectancy of blacks is generally less than other groups. c. Social Security tax rates imposed on blacks are higher than those imposed on other groups. d. Social Security benefit formula is disadvantageous to blacks.