Suppose that a worker in Country A can make either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can make either 18 bananas or 6 tomatoes each year. Country B has 400 workers. For a worker in Country A, the trade-off of making one tomato is:
A. 4 bananas.
B. 2 bananas.
C. 3 bananas.
D. 5 bananas.
Answer: D
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Refer to the figure above. If the optimal number of machines rented is 100, the market rental price must be:
A) $3 per month. B) $4 per month. C) $5 per month. D) $7 per month.
We typically think of labor as a variable cost, even in the very short run. However, some labor costs may be fixed. Which of the following items represents an example of a fixed labor cost?
A) An hourly employee B) A temporary worker who is paid by the hour C) A salaried manager who has a three-year employment contract D) none of the above
People in developing countries may want to participate in a rotating savings and credit association (ROSCAS) because:
a. such associations are part of the black market and they offer attractive returns. b. such associations promise a guaranteed return unlike other banking institutions. c. such associations allow participating individuals to invest their savings abroad. d. such associations allow all but the last member to receive funds faster than they could save on their own. e. most governments encourage it.
The largest component of GDP is:
A. government spending. B. consumption expenditures. C. private investment expenditures. D. net exports.