A firm has passed the point of diminishing marginal returns if and only if additional
labor lowers its output.
Positive externalities created by human capital provide one explanation of why firms do
not move more capital to low-wage areas.
If the legal incidence of a tax is entirely on suppliers, then the tax will have no
economic effect on demanders.
An economist uses a consumer’s demand curve to express the solutions to a family of
optimization problems.
By definition, a risk preferring person will gamble no matter what the odds.
A model that is said to be robust is one that has many details and closely mimics reality.
Either a rise in marginal cost or a fall in marginal revenue could cause a firm to reduce
its output.
A nonexcludable good, once produced, can be made available to others at no additional
cost.
Changes in an industry’s fortunes are felt most by those factors of production that are
elastically supplied.
When people have identical tastes, nobody has any incentive to maintain or improve a
property that is commonly owned.
The most efficient typist is the one who can type the greatest number of words per
minute.
A worker will not supply any labor when the wage rate is less than the marginal value
of leisure.
When high levels of labor are employed, total production tends to increase at a
decreasing rate.
Explain why a firm’s long-run total cost is no greater than its short-run total cost. Under
what circumstances will the two be equal?
A consumption tax may not lead to a welfare loss if demand in the market is perfectly
inelastic.