If the firm has no competitors, the marginal revenue curve is
A. downward sloping.
B. vertical.
C. flat (horizontal).
D. upward sloping.
Answer: A
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In a free market for rental housing, the average rental rate
a. includes a large amount of economic rent. b. includes zero economic rent. c. is entirely economic rent, since rental housing is fixed in supply. d. is about 10 percent economic rent.
Refer to the above figure. Suppose the economy is at point B and the central bank adopts contractionary monetary policy. In the short run, this will result in
A. the economy moving towards point A. B. the economy staying at point B. C. the economy moving towards point C. D. an outcome that cannot be predicted, because not enough information is given.
If price falls below the minimum point on the AVC curve, in the short run the firm should ________, and in the long run the firm should ________.
A. produce where MC = MR; exit the industry B. shut down; exit the industry C. shut down; expand D. produce where MC = MR; expand
Assume that a union representative argues that the social security tax is essentially paid for completely by the worker in the form of a lower wage equal to the amount of the tax
If this person were correct what is implicitly assumed to be the shape of the labor supply curve and why? Is this a reasonable assumption? Why or why not?