The labor supply for an industry would decrease if
A) the wage rate falls.
B) the percentage of the population from age 16 to 65 decreases.
C) the government welcomes foreign workers into the country.
D) a greater percentage of women want to work outside the home.
Which of the following characteristics of a farmers’ market make it a good example of a
perfectly competitive market?
A) Selling product at a farmers’ market was very profitable for farmers in the early
2000s. As result, many farmers sold their farms to larger firms.
B) Farmers who sell product at a farmers’ market are similar to other entrepreneurs who
introduce products that earn short-run profits but invite competition that drives down
prices and profits in the long run.
C) Farmers who sell product at a farmers’ market are similar to other business owners
who take advantage of the willingness of some consumers to pay high prices for new
and different products.
D) Farmers selling product at a farmers’ market provide a product that is a necessity,
rather than a luxury.
An increase in the supply of capital, which is a complement to labor, will lead to
A) a decrease in the quantity of labor demanded.
B) an increase in the demand for labor.
C) a decrease in the demand for labor.
D) an increase in the quantity of labor demanded.
National income =
A) Consumption + Saving – Taxes
B) Consumption – Saving – Taxes
C) Consumption – Saving +Taxes
D) Consumption + Saving + Taxes
Which of the following describes a difference between the marginal revenue and
demand curves of a perfectly competitive firm and a monopolistically competitive firm?
A) The perfectly competitive firm’s marginal revenue and demand curves are the same;
the marginal revenue curve of a monopolistically competitive firm lies above its
demand curve.
B) The perfectly competitive firm’s marginal revenue and demand curves are the same;
the marginal revenue curve of a monopolistically competitive firm lies below its
demand curve.
C) The monopolistically competitive firm’s marginal revenue and demand curves are
the same; the marginal revenue curve of a perfectly competitive firm lies below its
demand curve.
D) The marginal revenue curve of a monopolistically competitive firm lies below its
demand curve; the marginal revenue curve of a perfectly competitive firm lies above its
demand curve.
Table 2-10
Table 2-10 shows the output per month of two people, Fred and Barney. They can either
devote their time to making pogo sticks or making unicycles. Which of the following
statements istrue?
A) Fred has an absolute advantage in making both products.
B) Barney has an absolute advantage in making both products.
C) Barney has an absolute advantage in making pogo sticks and Fred in making
unicycles.
D) Barney has an absolute advantage in making unicycles and Fred in making pogo
sticks.
Average variable cost can be calculated using any of the formulas below except
A) TVC/Q.
B) (TC – FC)/Q.
C) (TC – FC)/Q.
D) (TC/Q) – AFC.
Microsoft hires marketing and sales specialists to decide what prices it should set for its
products, whereas a wealthy corn farmer in Iowa, who sells his output in the world
commodity market, does not. Why is this so?
A) because Microsoft is large enough to hire the best people in the field
B) because Microsoft could potentially lose sales if it sets prices indiscriminately
C) because the wealthy corn farmer is a price taker who chooses his optimal output
independently of market price but Microsoft’s optimal output depends on the price it
selects
D) because unlike Microsoft, the wealthy corn farmer is probably a monopolist
Figure 12-4
Figure 12-4 shows the cost and demand
curves for a profit-maximizing firm in a perfectly competitive market. What is the
amount of its total fixed cost?
A) $1,080
B) $1,440
C) $2,520
D) It cannot be determined.
An example of a monopoly based on control of a key resource is
A) Major League Baseball.
B) the Paul Ecke Ranch monopoly on poinsettias.
C) Microsoft’s Windows operating system.
D) the U.S. Food and Drug Administration.