Factors of production are
a. used to produce goods and services.
b. also called output.
c. abundant in most economies.
d. assumed to be owned by firms in the circular-flow diagram.
a
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Assuming Cournot behavior, what happens to the market output, the price of the output, and each firm's output as the number of firms in a market increases?
What will be an ideal response?
Suppose technical change permits cable television companies to provide their services at lower rates. The share-the-gains, share-the-pains theory would predict that the regulators would
A) permit the firms to keep the savings and would lower prices only if the firms were pressured to do so. B) force the firms to pass all the savings on to consumers in the form of lower prices. C) force the firms to pass the savings on to consumers in the form of better service. D) force the firms to pass some of the savings on to consumers and to permit the firms to keep some of the savings themselves.
Which of the following might explain why the government would create a price floor for a certain good?
a. The equilibrium price that would result in the market would be considered too high b. The equilibrium price that would result in the market would be considered too low c. The equilibrium quantity that would result in the market would be considered too high d. The equilibrium quantity that would result in the market would be considered too low e. The market will never achieve equilibrium on its own
If a corporation earns $1 million in revenues on $750,000 in expenses, including $415,000 from payrolls, and the corporate tax rate is 10 percent with a $100,000 exemption, then the corporate taxes would be
A. $90,000. B. $31,000. C. $25,000. D. $15,000.