Use the following graph of an oligopolistic firm.
Suppose all firms within the cartel have identical costs of production. The cartel is earning
A. accounting profit but not economic profit.
B. zero economic profit.
C. economic profit.
D. negative economic profit.
Answer: C
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Which of the following statements are TRUE regarding the demand for labor?
I. The quantity of labor demanded depends on the real wage rate. II. If the money wage rate increases and the price level remains the same, the quantity of labor demanded decreases. A) I only B) II only C) I and II D) neither I nor II
Which of the following is not a method to internalize or adjust for externalities?
A. persuasion B. assignment of property rights C. unilateral transfers D. voluntary agreements
Diamonds are expensive because:
A. very few diamonds are discovered each year. B. the seller of most diamonds in the world restricts output. C. they are a symbol of luxury. D. they are a form of conspicuous consumption.
When a certain monopoly sets its price at $8 it sells 64 units. When the monopoly sets its price at $9 it sells 62 units. The marginal revenue for the firm over this range is
a. $18. b. $23. c. $46. d. $92.