Over the past 50 years, the growth of real GDP in the United States has been caused primarily by increase in the _____.

If both the goods and the labor market are perfectly competitive, a firm that hires labor up to a point where the value of marginal product of labor equals the wage rate also produces at a point where price is:

A) equal to average cost. B) equal to marginal cost. C) less than marginal cost. D) higher than marginal cost.

The Redwood City Council has decided that there is an overallocation of resources in the lawn-care industry. Almost every homeowner owns a lawnmower, hose and sprinkler, seeder, spreader, etc., and these items are used, at most, once a week. The council

will establish a legal monopoly and select a private firm that will be responsible for all lawn care in the city. What types of rent-seeking activities can be expected as a result of this action?