Suppose a lawn-mowing business has a mower for which it paid $1000 and workers for which they pay $10 per hour. Suppose each mower can mow a lawn per hour.
A. Their variable cost per lawn is $10 + $1000/lawns mowed.
B. Their average fixed cost is $1000/lawns mowed.
C. Their average fixed cost is $10 per lawn mowed.
D. Their average fixed cost is $1000.
Answer: B
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A) an exclusive good. B) a common good. C) an impure good. D) a club good.
Income effect results in _____
a. a change in the elasticity of demand of a consumer b. a change in the buying power of consumers c. a change in the opportunity cost d. a change in the permanent income of a consumer
Which of the following would NOT shift an industry's supply of labor curve?
A) The wage rate in the particular industry falls. B) Wage rates in industries using similar labor rise. C) Working conditions within the industry become less desirable. D) Wage rates in other industries fall.
The simple immigration model assumes that the capital stock is constant in each country. If this assumption is relaxed, then the:
A. Rise in business income in the high-wage country will increase the return on capital, which will increase the demand for labor B. Fall in business income in the high-wage country will decrease the return on capital, which will increase the demand for labor C. Rise in business income in the high-wage country will increase the return on capital, which will decrease the demand for labor D. Fall in business income in the high-wage country will decrease the return on capital, which will decrease the demand for labor