Assume that a health spa can earn an additional $35,000 of revenue each year from advertising every day in a local newspaper. What must the additional cost of this daily advertising be to make this advertising economically rational?
What will be an ideal response?
The additional cost of the daily advertising must be no more than $35,000 for the year to make advertising economically rational.
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In the European Union, resale price maintenance is generally illegal is the selling firm has more than a ________ percent market share of the product being sold or the buying firm makes more than a ________ percent market share of the product purchases.
A) 30; 30 B) 50; 50 C) 30; 50 D) 50; 30
Ajax has just discovered that the marginal revenue product generated by the last worker hired was $75 while the marginal factor cost was $95. What should Ajax do?
A) Leave the level of production unchanged. B) Increase the amount produced. C) Reduce the amount produced. D) Collect more information before making a decision.
In this example, why is the graph for total utility curved whereas the graph for marginal utility is straight?
a. Total utility has a constant positive slope whereas marginal utility has a constant negative slope.
b. The slope of the total utility graph is positive but constantly decreasing at the rate shown on the marginal utility graph.
c. The slope of the marginal utility graph is negative but constantly increasing at the rate show on the total utility graph.
d. Marginal utility has a constant positive slope whereas totally utility has a constant negative slope.
In response to the demands of environmentalists, large sections of timberlands are put off limits to logging. What effect will this have on the aggregate supply curve?
A. Shift the curve outward. B. Shift the curve inward. C. Move the economy up along the curve. D. Move the economy down along the curve.