If a firm in a competitive labor market offers less than the market wage rate, it will
A. find that it has broken a federal wage law.
B. find that the supply is greater than the demand.
C. attract too few employees.
D. be able to attract a large number of employees because the marginal revenue product is low.
Answer: C
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In our study of monopoly, we found that monopolists can increase profit by segmenting the market and price discriminating (under third degree price discrimination). Now suppose a firm is producing an excludable local public good. Can you justify a form of such market segmentation and price discrimination as efficient?
What will be an ideal response?
Which of the following is true regarding the measurement of GDP?
A) Wages and profit income are used in the income approach to GDP. B) Wages and consumption are used in the expenditure approach to GDP. C) Consumption and investment are used in the income approach to GDP. D) Government expenditure is only counted in the income approach to GDP. E) Investment and wages are expenditures, and are therefore are used in the expenditure approach to GDP.
Explain the relationship between price, short-run marginal cost, short-run average cost and long-run average cost in the final long-run competitive equilibrium condition. What are economic profits in this long-run equilibrium condition?
What will be an ideal response?
The demand curve for a good
a. is determined primarily by the cost of producing the good. b. indicates the relationship between the price of the good and the price of other goods. c. illustrates the quantity producers will provide at alternative prices. d. indicates the quantities of the good that people are willing to purchase at various prices.