Question

In: Economics

36 The Internal Revenue Service is a good example of a government for-profit entity that is...

36

The Internal Revenue Service is a good example of a government for-profit entity that is always trying to proactively maximize their MC=MR.   

True or False

38

If the market price for a product is just one dollar above the average fixed cost curve, but still way below the average variable cost curve, then this should make the small business owner feel better. Standard microeconomic theory would recommend that they should still stay open for business until they can figure out how to become more profitable.   

True or False

39

What exactly does elasticity mean in microeconomics?

Multiple Choice

  • The demand curve must first shift before we can determine the elasticity of demand.

  • It measures the satisfaction of the consumer when they purchase items at different prices.   

  • When we change quantity (the cause), then we will determine the price (the effect).

  • When we change the price (the cause), then we will determine the quantity (the effect).

40

Let’s suppose that the state government orders that the minimum wage will be cut from $15.00 per hour to $4.00 per hour. We can probably assume that the new wage is a price ceiling and that the supply of labor will shrink, which will probably lead to a shortage of labor.

True or False

Solutions

Expert Solution

Rahul Sunny answered 1 year ago
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