When labor is a firm's only variable input in its production process, a profit-maximizing firm will continue to employ additional workers as long as:
a. the marginal product of labor > 0
b. the marginal revenue product of labor < the marginal resource cost.
c. the marginal revenue product of labor > the marginal resource cost.
d. none of the above.
c
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If the quantity of gasoline supplied currently exceeds the quantity demanded,
A) there is a surplus of gasoline. B) gasoline is no longer a scarce good. C) the price of gasoline would tend to remain unchanged. D) all of the above are true. E) none of the above is true.
In an open outcry Dutch auction, ________
A) the bidders begin the bidding process with a low starting bid B) the auctioneer begins the bidding process with a low starting bid C) the auctioneer begins the bidding process with a high starting bid D) the bidders decide the starting bid
A businessman is confronted with the following opportunity. He can invest $10,000 in a project that will either succeed wildly, fail miserably, or simply pay him back his $10,000. If wildly successful, the project will earn the businessman $110,000, but if it fails he will not get any money back.
i. If the businessman is risk neutral and he feels that there is a 1/2 chance of miserable failure, then what is the minimum probability of wild success required for him to want to invest in the project? ii. Based on the probability that you derived in part i, explain what you know about the minimum probability that would be required by a risk averse businessman.
In 2009 Congress passed legislation providing states with funds to build roads and bridges. It also instituted tax cuts. Which of these shifts aggregate demand right?
a. only the increased funding for states b. only the tax cuts c. both the increased funding for states and the tax cuts d. neither the increased funding for states nor the tax cuts