Consider a textile factory operating in the short run. Classify the following costs that the firm incurs as variable costs, sunk costs, and fixed costs
a) Cost of issuing identity cards to all workers
b) Wages paid to workers of the factory
c) Yearly rent paid for production space
d) Tax paid on the sale of its products
a) Cost of issuing identity cards to all employees is a sunk cost as it is not to be considered while making future production decisions.
b) Wages paid to workers at the mill are variable costs as they change with changes in the output of the production unit.
c) Yearly rent paid for the production space is a fixed cost as the mill has to pay this rent irrespective of the output produced.
d) Tax paid on the sale of the firm's products is a variable cost as the tax will vary depending on the output sold by the firm.
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward
What properties distinguish private goods from public goods?
a. preventive and curative b. exclusiveness and rivalry c. social and cooperative d. merit and lack of merit e. market and nonmarket
Differentiate between rational expectation and adaptive expectation using suitable examples
Which of the following is the clearest evidence of employment discrimination against minority employees?
a. the average wage of minority workers is lower than the average wage of whites. b. the average hours worked by minority employees exceeds the hours worked by whites. c. the mean number of years of schooling of minority workers is lower than that of whites. d. the average wages of minority employees are lower than the average wages of whites with similar productivity characteristics.