The farther the Lorenz curve for income is from the line of equality, the more ________ is distributed.
A) equally wealth
B) unequally income
C) unequally wealth
D) equally income
Ques. 2Winnie's Car Wash is a perfectly competitive firm. The table above shows Winnie's total product schedule. What is the marginal product of labor when the 5th worker is hired?
A) 72.5 car washes
B) 75 car washes
C) 5 car washes
D) 3 car washes
Ques. 3A firm in monopolistic competition has some degree of price-setting power because
A) in the long run it earns a normal profit.
B) it can never earn less than normal profit.
C) the price it charges is never more than its marginal cost.
D) if it raises its price, the quantity it can sell will not decrease to zero.
Ques. 4When two firms collude to maximize profit the total quantity produced by both firms taken together is determined at the quantity where ________.
A) excess capacity is minimized
B) industry marginal cost equals industry marginal revenue
C) the price equals the industry's marginal cost
D) excess capacity is as large as possible zero
Ques. 5In a diagram with the total cost curve and the total variable cost curve, as output increases, the vertical distance between these two curves
A) is constant.
B) decreases.
C) increases.
D) gets smaller and then bigger again.
Ques. 6Suppose that Tracy and Pat start a business. Because of a series of bad decisions by Tracy, the company goes bankrupt, owing a total of 50,000. Tracy is penniless and Pat is a millionaire.
If the company were organized as a partnership, Pat would be responsible for A) over 1 million of debt.
B) 50,000 of debt.
C) 25,000 of debt.
D) 0 of debt.
Ques. 7The above figure shows the market for anti-freeze. The government imposes the sales tax shown in the figure on sellers. Anti-freeze sellers would pay a larger part of this tax than what is shown in the figure if the
A) demand were more inelastic.
B) demand curve were steeper.
C) supply were more inelastic.
D) supply were more elastic.
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