Table 7-6
Number of ovens
2
2
2
2
2
2
2
2
Labor hours used
1
2
3
4
5
6
7
8
Loaves of bread produced
20
34
55
70
82
91
94
92
Table 7-6 shows a baker’s daily production relationship for bread. Diminishing returns to labor begin when the baker goes from
A. one hour of labor to two hours of labor.
B. three hours of labor to four hours of labor.
C. six hours of labor to seven hours of labor.
D. seven hours of labor to eight hours of labor.
Answer: B
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Suppose the industry for washing machines has only four firms. The market shares are: Firm A, 40 percent; Firm B, 20 percent; Firm C 20, percent; and Firm D, 20 percent
a) What is the Herfindahl-Hirschman Index (HHI)? b) If Firms C and D were to announce a merger, would the Department of Justice oppose the merger?
Explain why a voluntary production quota is difficult to operate
What will be an ideal response?
Suppose Derek earns an annual income of $96,000 . If the rate of growth of his income remains constant at 15 percent, he is most likely to earn _____ per year after 2 years
a. $178,987 b. $145,700 c. $10,000 d. $126,960