Constant elasticity of substitution

  variable cost D.  total return E.  sacrifice   27. Dean runs a woodworking business specializing in kitchen cabinets. He knows there are other firms with top-of-the-line machinery that make better quality cabinets, but he does well and has a constant flow of business. Dean obviously has:    A.  figured out how to produce cheap products. B.  priced his products well. C.  reduced his variable costs by investing in fixed costs. D.  avoided monopolistic competition, and is instead in a market

* Question 1 0 out of 1 points | | | Duopolists A and B face the following demand curves: QA = 120  2PA + PB and QB = 120  2PB + PA. If both firms have zero marginal cost and they form a cartel, what is the profit-maximizing price and quantity?Answer | | | | | Correct Answer: |  a.  P = 60, Q = 120 | | | | | * Question 2 1 out of 1 points | | | Total surplus in a market is a measure of:Answer | | | | | Correct Answer: |  c.  social welfare created by the market

MBS666 Practice Multiple Choice Questions MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) Economics is the study of the ________ people make to attain their goals, given their ________ resources. A) decisions; household B) purchases; unlimited C) income; available D) choices; scarce 2) Which of the following is what economically rational people do? A) Respond to economic incentives. B) Weigh the benefits and costs of all possible alternative

Test Version A SEMESTER I EXAMINATIONS Mid-Term Assessment ECON 30110 Microeconomics II Time Allowed: 50 minutes Instructions for Candidates This exam counts for 30% of the Module Grade. All questions carry equal marks. Note there is NO negative marking Correct answer is worth 1 mark. No answer or more than one answer, will both receive a 0 mark. Incorrect answer will receive a 0 mark. Attempt all 20 questions. Shade in the box in the appropriate space with

this is because the classical economists believe in Say’s law that “supply creates its own demand assuming a full level of employment of income in the economy” thus the demand for money in fisher’s approach is a constant proportion of the level of transactions which in turn bears a constant proportion in the level of national income. Further, the demand for money is linked to the volume of trade going on in the economy at a given time. Criticisms of the classical theory Its underlying assumption

1. Name two types of market failure. Explain why each may cause market outcomes to be inefficient. Market Power- In some markets, a single buyer or seller may be able to control the market prices. Market Power can cause inefficiency because it keeps the price and quantity away from the equilibrium of supply and demand. Externalities- The impact of one person’s actions on the well-being of a bystander. Since buyers and sellers do not consider these side effects when deciding how much to consume

human capital or technology investment, then the costs of production decrease. This exerts a positive effect on the supply curve shifting it right, where the new market equilibrium is at a higher quantity and a lower price, holding everything else constant. There can also be a negative shift that moves the supply curve to the left, with the resulting market clearing price being higher and quantity lower, ceteris

Literature Review: The idea of tax progressivity has a significant employment effect and has been investigated over the past few years and so. According to theoretical research on the effect of tax progression on equilibrium wage and employment critically depend on the nature of the agent whether they are wage-setters or wage-takers. One strand of theoretical work, associated in particular with Richard Jackman and Richard Layard, has examined the implications of so called tax-based incomes policies

Chapter 4: Costs and Cost Minimization Multiple Choice 1. Suppose you are a star basketball player at a major university in your sophomore year. You are sought after by several NBA teams. Which of the following choices best characterizes your opportunity cost if you choose to drop out of college and enter the NBA? a) The value of your college scholarship that you have given up. b) The skills that two more years of playing at your college would have given you along with their additional value

Chapter 4: Costs and Cost Minimization Multiple Choice 1. Suppose you are a star basketball player at a major university in your sophomore year. You are sought after by several NBA teams. Which of the following choices best characterizes your opportunity cost if you choose to drop out of college and enter the NBA? a) The value of your college scholarship that you have given up. b) The skills that two more years of playing at your college would have given you along with