One way to explain the convexity of isoquants is to say that
A) as labor increases and capital decreases, MPL rises while MPK falls.
B) as labor increases and capital decreases, MPL falls while MPK rises.
C) as labor increases and capital decreases, MPL and MPK both fall.
D) as labor increases and capital decreases, MPL and MPK both rise.
B
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Real consumption spending is inversely related to
a. real disposable income b. the amount of common stock owned c. the amount of real estate owned d. expectations of future income e. the interest rate
Many saltwater fish species are currently being overexploited. This is an example of
a. efficiency b. the tragedy of the commons c. Pareto optimality d. a negative externality e. a positive externality
If, in a given market of multiple producers, there is a positive gap between price and average cost (P > AC) for an extended period of time, this would suggest that
A. there are many sellers in the industry. B. there exists an oligopoly or cartel in the industry. C. this is a contestable market. D. the firm cannot be a monopolistic competitor.
Points lying _____________ the production possibilities curve represent greater, but unachievable levels of output with current inputs, than that at any point on the curve.
a. inside b. along c. outside d. the midpoint of e. at the axis of