A monopsony will never pay a wage that is
A) equal to the minimum wage.
B) less than the value of marginal product.
C) more than the value of marginal product.
D) negotiated with the union.
Ques. 2The graph shows costs and benefits of a mosquito control program, which is a public good:
a) What is the quantity of spraying that achieves efficiency?
b) What is the political equilibrium if voters are well informed?
Ques. 3Does Mr. McConaughey's marginal utility from spending time with family and friends and from breaking a sweat obey the principle of diminishing marginal utility?
A) No, neither obeys the principle of diminishing marginal utility.
B) Only breaking a sweat obeys the principle of diminishing marginal utility.
C) Yes, they both obey the principle of diminishing marginal utility.
D) Only spending time with friends and family obeys the principle of diminishing marginal utility.
Ques. 4In monopolistic competition, product improvement and development
A) are valued by the consumer at an amount equal to the costs the producers have incurred.
B) yields a marginal benefit to the producer equal to price of the good.
C) is less than its efficient amount.
D) None of the above answers are correct.
Ques. 5In an indifference curve/budget line diagram, at your consumer equilibrium, that is, your best affordable point, which of the following statements is CORRECT?
A) Any movement upward or downward on your budget line will move you to a less preferred point.
B) Any movement upward or downward on your indifference curve will move you to a less preferred point.
C) Your marginal rate of substitution is greater than the magnitude of the budget line by as much as possible.
D) All of the above are correct.
Ques. 6The range of output over which a firm's average variable cost is decreasing is the same as the range over which its
A) marginal cost is increasing.
B) average fixed cost is decreasing.
C) average product is increasing.
D) average product is decreasing.
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