To make a rational choice, a person
A) adds the total costs to determine if the total is small enough.
B) adds the total benefits and the total costs and then compares the two totals.
C) takes account of all benefits and all opportunity costs, including both marginal costs and sunk costs.
D) adds the total benefits to determine if the total is large enough.
E) compares the extra benefits of one more unit to the extra costs of one more unit.
E
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In the short run, total variable cost
A) includes the cost of capital. B) includes the cost of labor. C) includes both the cost of capital and of labor. D) does not change when production changes. E) is positive when output is zero.
If the MPC = 0.75 for a particular person this means that:
A. they will spend 75 cents of each new dollar they get. B. if they receive $1 then they want to spend 25% of it. C. if they receive $1 they want to spend roughly 75%, but probably won't do so. D. they will spend 25 cents of the $1 and save 75 cents.
Which measure of productivity is calculated as a residual?
A. Labor force productivity B. Labor force participation C. Real GDP D. Total factor (or multifactor) productivity
In comparing monopolistic competition to perfect competition, one can conclude that the lack of free entry is the key to having the ability to set price
Indicate whether the statement is true or false