Which answer below CORRECTLY describes the relationship between the demand for labor curve and the value of marginal product curve?
A) The curves intersect to determine the equilibrium quantity of labor.
B) The value of marginal product curve lies to the right and above the demand for labor curve.
C) The curves are the same.
D) The value of marginal product curve lies to the left of the demand for labor curve.
Ques. 2In monopolistic competition, firms can make an economic profit in
A) the short run and in the long run.
B) the short run but not in the long run.
C) the long run but not in the short run.
D) neither the long run nor the short run.
Ques. 3Jason is a Web page designer. He estimates that this summer, he has a 0.6 probability of making 10,000 and a 0.4 probability of making only 2,000. What is Jason's expected income this summer?
A) 12,000
B) 6,800
C) 6,000
D) 10,000
Ques. 4Oscar and Felix are the only firms that clean offices in a large city. They agree to operate as a cartel. The payoff matrix above gives the economic profit that each firm can make.
If Felix cheats on the agreement but Oscar complies, Felix makes an economic profit of ________ and Oscar makes an economic profit of ________. A) 10 million; 10 million
B) 1 million; 1 million
C) -2 million; 12 million
D) 12 million; -2 million
Ques. 5For a public good, the marginal social benefit curve is the ________ summation of all the individual marginal benefit curves.
For a private good, the marginal social benefit curve is the ________ summation of all the individual marginal benefit curves. A) horizontal; vertical
B) vertical; horizontal
C) vertical; vertical
D) horizontal; horizontal
Ques. 6The CORRECT ranking of the four basic market structures from low (Herfindahl-Hirschaman Index) HHI to high HHI is
A) perfect competition, oligopoly, monopolistic competition, monopoly.
B) monopoly, oligopoly, monopolistic competition, perfect competition.
C) perfect competition, monopolistic competition, oligopoly, monopoly.
D) monopoly, monopolistic competition, oligopoly, perfect competition.
Ques. 7The figure above shows a firm in a perfectly competitive market. If the firm does not shut down, the least amount of output that it will produce is
A) less than 5 units.
B) 5 units.
C) 8 units.
D) 10 units.
Ques. 8The above figure shows the Lorenz curves for four different countries. In which country is income most equally distributed?
A) country A
B) country B
C) country C
D) country D
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