question
Is a fixed cost (lease,rent,etc) in short-run equilibrium counted towards Marginal Cost?
answer
No
question
If a series of trades results in a situation in which the buyer value of any demander who did not make a trade is less than the seller cost of any supplier who did not make a trade, the outcome of those trades is efficient.
answer
False
question
If the supply curve for a good is perfectly inelastic, a tax of $10 per unit levied on sellers of the good will have a lower excess burden than a tax of $10 per unit levied on buyers of the good.
answer
False
question
If the supply curve for a good is perfectly elastic, a per unit tax levied on sellers of the good will not make sellers worse off.
answer
True
question
If producing a good creates a negative externality, the social cost of producing the good exceeds the private cost of producing it.
answer
True
question
If the demand curve for labor is elastic and the minimum wage exceeds the equilibrium wage, an increase in the minimum wage will decrease the total wage income of all workers.
answer
True
question
If a series of trades in the farmers apple market results in an efficient outcome, the buyer value of every buyer who did not purchase a bushel of apples must be less than or equal to the buyer value of every buyer who did purchase a bushel of apples.
answer
True
question
If the demand for a good is elastic, an outward shift in the supply of the good will increase the total amount buyers spend on the good.
answer
True
question
If the supply curve for a good is perfectly inelastic, an excise tax on the good will have no deadweight loss.
answer
True
question
If the average value product of labor exceeds the wage a workers receives, a firm can increase its profit by hiring an additional worker.
answer
False
question
In a constant cost industry, an increase in demand will effect the price of long run more than the short run.
answer
False
question
If a firm in a perfectly competitive market is selling its product for a price greater than the marginal cost of producing it, the firm can increase its profits by producing more.
answer
True
question
If the demand for a monopolist's output is perfectly elastic, the monopolist's marginal revenue equals the price it charges for its output.
answer
True
question
If the govt. imposes a tax on CO2 emissions and polluters react by minimizing the total cost of their emissions, the marginal cost of reducing CO2 emissions from any site will be greater than or equal to the tax on a unit of emissions.
answer
True
question
If a series of trades has made each buyer and seller better off, there are no further trades that would make both buyer and seller better off, and there are no externalities, the outcomes of these trades is efficient.
answer
False
question
If a household is maximizing its utility subject to a budget constraint and two goods have the same marginal utility, the household is purchasing equal amounts of the two goods.
answer
False
question
If a monopolist faces a downward-sloping demand curve for its product, it will maximize its profits by producing the output that maximizes its marginal revenue.
answer
False
question
In the short run, a firm should produce the output that minimizes its average variable cost
answer
False
question
For this question, assume that the only input a firm can vary is the number of workers it hires and that the wage it pays those workers does not depend on the number it hires. With those assumptions, if the average product of labor rises as the firm hires more workers, the average variable cost of the firm falls as it produces more output.
answer
True
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