Blog

Question is based on the chart below for a firm that is perfectly competitive in both the labor and product markets, showing how much daily output a firm can produce using different numbers of workers. Table: Perfectly Competitive Firm in Both the Labor and Product Markets Number of Workers Output 1 3 2 9 3 16 4 21 5 23 6 24 If output sells for $20 per unit and the daily wage is $100 per worker, how many workers should the firm hire to maximize profit?

Which of the following is true of a monopsony in a labor market?

The following graph shows the demand for steel by US consumers, supply of steel by US manufacturers, and the world price of steel. This diagram shows a market for grain with price on the vertical axis and quantity in tons on the horizontal axis. It features downward-sloping demand and upward-sloping domestic supply curves. Three horizontal price lines are labeled: P1 at the highest level, PT in the middle, and PW marked as the World Price at the lowest level. Several regions of the graph are labeled with capital letters from H at the top to Y at the bottom, divided by dashed lines that intersect quantity markers Q1 through Q5. Areas between price levels and quantities are subdivided to highlight different rectangles and regions, such as I, J, K, L, M, N, R, S, and others, suggesting zones for analyzing surplus, tariffs, or quotas. The overall graph is designed to show how domestic and world prices interact with demand, supply, and potential policy interventions in the grain market. Use the labeling on the graph to answer the questions. a-f. What is the price and quantity of steel in the US market before trade occurs? (1 point) What is the area of consumer surplus before trade occurs? (1 point) What is the area of producer surplus before trade occurs? (1 point) Now assume the US begins to import steel from the world market at a price of Pw. Identify the quantity of steel imported by the US. (2 points) Now assume the US imposes a tariff that raises the price of steel from Pw to PT. Use the labeling on the graph to identify the change in each of the following: Domestic consumption (2 points) Domestic production (2 points) Producer surplus (2 points) Consumer surplus (2 points) What is the area of deadweight loss as a result of the tariff? (2 points)

Which of the following best defines a pure public good?

Assuming a single, profit-maximizing employer in a labor market with many workers, which of the following statements relating to this monopsony is true?

The following questions are based on the graph provided, which shows the marginal private cost (MPC), marginal social cost (MSC), marginal private benefit (MPB), and marginal social benefit (MSB) in a market for a good that has an external cost. The figure shows the graph of three curves in the first quadrant of a coordinate plane. The horizontal axis is labeled “Quantity,” and the values 6, 9, and 12 are indicated. The vertical axis is labeled “Price, Cost, in dollars,” and the values 0, a break, and 4.50 through 5.50, in increments of 0.25, are indicated. The three curves are labeled M S B equals M P B, M S C, and M P C. The M S B equals M P B curve begins just to the left of a quantity of 6, and above a price of 5.50, and moves downward and to the right in a straight line. It passes through the points with coordinates 6 comma 5.50, 9 comma 5.25, and 12 comma 5.00. It ends far to the right of quantity 12, slightly below price 4.50. The M S C curve begins about halfway between a quantity of 0 and 6, at price of 4.75, and moves upward and to the right in a straight line. It passes through the point with coordinates 6 comma 5.00, intersects the M S B equals M P B at the point with coordinates 9 comma 5.25, and passes through the point with coordinates 12 comma 5.50. It ends to the right of quantity 12 and above price 5.50. The M P C curve begins to the left of quantity 6, just below price 4.50, and moves upward and to the right in a straight line, parallel to the M S C curve. It passes through the points with coordinates 6 comma 4.50, and 9 comma 4.75, and it intersects M S B equals M P B curve at the point with coordinates 12 comma 5.00. It ends to the right of quantity 12, and slightly above price 5.25. What are the socially efficient and market equilibrium quantities?

Which of the following best describes firms in an industry if all the firms are in a cartel?

The figure shows the graph of four curves. The horizontal axis is labeled “Quantity,” and the vertical axis is labeled “Price comma Cost.” The quantities Q sub 0, Q sub 1, Q sub 2, Q sub 3, and Q sub 4 are indicated on the horizontal axis. Q sub 0 is located about one fourth of the way along the axis. The distance from Q sub 1 to Q sub 0 is about one third of the distance between the vertical axis is Q sub 0. The distance from Q sub 2 to Q sub 1 is slightly less than the distance from Q sub 1 to Q sub 0. The distance from Q sub 3 to Q sub 2 is slightly less than the distance from Q sub 2 to Q sub 0. Q sub 4 is just to the right of Q sub 3. The curves are labeled D, M R, M C, and A T C. Curve D begins on the vertical axis, high above the origin, and moves downward and to the right in a straight line until it ends on the horizontal axis, far to the right of Q sub 4. Curve M R begins at the same point as curve D high on the vertical axis, and moves steeply downward and to the right in a straight line until it ends on the horizontal axis at Q sub 1. Curve M C begins about one fourth of the way up the vertical axis, and moves upward and to the right. It intersects curve M R at Q sub 0, intersects curve D at Q sub 3, and ends to the right of Q sub 4, about two thirds of the way up the vertical axis. Curve A T C begins just to the right of, and about half way up, the vertical axis. It moves gradually downward and to the right, crosses curve M R to the left of Q sub 0, and reaches its lowest point where it intersects curve M C at Q sub 2. It then moves gradually upward and to the right, intersects curve D at Q sub 4, and ends far to the right of Q sub 4, just under its initial height. The graph above shows the demand (D), marginal revenue (MR), marginal cost (MC), and average total cost (ATC) curves for a monopoly. Based on the information in the graph provided, what is the profit-maximizing quantity for a monopolist that engages in perfect price discrimination?

A chemical plant pollutes a river that serves as the water supply for a nearby town. From an economist’s point of view, pollution from the plant should be reduced until the

Assume the market for disposable coffee cups is in equilibrium and disposable coffee cups are inputs for serving brewed coffee. Which of the following will result in a higher short-run equilibrium price of disposable coffee cups?