Suppose a farmer is a price taker for soybean sales with cost functions given by TC = .1q2 + 2q + 30 MC = .2q + 2 If P = 6 , the profit-maximizing level of output is
a. 10
b. 20
c. 40
d. 80
b
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What is discretionary fiscal policy and what is its purpose?
What will be an ideal response?
In a competition of financial analysts vs. throwing a dart to choose stocks, according Burton Malkiel, financial analysts came out ahead due to all of the following reasons EXCEPT:
A) it considered only stock prices, not dividends B) investors that followed the contest were influenced to purchase the stocks recommended by the analysts C) failure of the Efficient Markets Hypothesis D) part of the return for the analysts resulted from compensation for the higher risk of the stocks chosen
The above figure shows the payoff matrix for two firms. A chemical firm must choose between a low level of production which yields one ton of pollution into a nearby lake and a high level of production which yields two tons of pollution into the
nearby lake. A private beach on the lake must decide whether to operate or not. Increased pollution reduces the number of people who wish to visit the beach. If the chemical firm owns the lake, and the beach owner must pay $10 to keep the chemical firm at just one ton of pollution, then A) the beach shuts down and the chemical firm produces one ton of pollution. B) the beach shuts down and the chemical firm produces two tons of pollution. C) the beach operates and the chemical firm produces one ton of pollution. D) the beach operates and the chemical firm produces two tons of pollution.
Use the figure below to answer the following question.
What area represents deadweight loss after the government imposes the excise tax on the market?
A. triangle abc B. square $13ac$9 C. triangle $21a$13 D. triangle $1c$9