For a perfectly competitive firm with a known marginal cost and random demand, as the expected marginal revenue increases, the profit-maximizing quantity ________.
A) approaches zero
B) increases
C) does not change
D) decreases
B) increases
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Mexico pegged its exchange rate to the U.S. dollar in the 1980s
A) to maintain a similar unemployment rate to the United States B) in an attempt to abandon the peso and switch to U.S. dollars as currency. C) to signal investors that Mexico was serious about controlling inflation. D) to discourage foreign investment.
Damian owns a tattoo parlor and has hired three tattoo artists to work for him. The marginal product of labor is 8 for the first artist, 12 for the second artist, and 7 for the third artist
What is Damian's average product of labor for these three tattoo artists?
When cost and demand are stable over time in an industry, repetition of Prisoners' Dilemma situations
A) can yield cooperative outcomes because firms can explicitly collude to set prices. B) can yield cooperative outcomes even when firms do not explicitly collude to set prices. C) cooperative or noncooperative outcomes may occur, but cooperation is harder than when the market is unstable. D) will tend to yield noncooperative outcomes. E) will always yield noncooperative outcomes.
A movie theatre raises ticket prices from $8 to $10 in order to raise revenues. The theatre's management is assuming the absolute value of the price elasticity of demand for tickets is
A) less than 1. B) greater than 1. C) equal to 1. D) infinity.