One worker produces 10 rocking chairs. If diminishing returns have already set in, a firm will need to hire more than two workers to produce 20 rocking chairs.
Answer the following statement true (T) or false (F)
True
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Suppose that, in the long run, a dairy's variable costs are VC = 2Q2 (where Q is the number of gallons of milk produced each day), its marginal cost is MC = 4Q and there is an avoidable fixed cost of $50 per day. In the long run there is free entry into the market. The long run market supply curve is:
A. vertical at 5 gallons per day. B. horizontal at $20 per gallon. C. horizontal at $50 per gallon. D. horizontal at $100 per gallon.
Economists believe that individuals respond in a predictable way to changes in costs and benefits. The term that best describes this belief is
a. opportunity cost b. demand c. supply d. scarcity e. rational behavior
Oligopolies are known for the mutual interdependence of firms
Indicate whether the statement is true or false
The following question relates to an oligopoly market where the industry demand curve is P = 100 - Q. What will industry output be at equilibrium in this model?
What will be an ideal response?