Which of the following is not an explicit cost?
a. Salaries.
b. Sales taxes.
c. Utilities, such as gas and electricity.
d. Insurance.
e. The firm owner's time.
e
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In the steady-state diagram of the Solow model, an increase in saving per worker is shown by
A) shifting the saving-per-worker curve down, resulting in a lower steady-state capital—labor ratio. B) shifting the saving-per-worker curve up, resulting in a higher steady-state-capital—labor ratio. C) shifting the saving-per-worker curve up, resulting in a lower steady-state capital—labor ratio. D) shifting the saving-per-worker curve down, resulting in a higher steady-state capital—labor ratio.
Suppose the marginal product of labor equals 1/L. If the wage is $1 per unit of labor, what is the short-run effect on the firm's labor demand if the price of output were to double?
A) The firm will demand half as much labor. B) The firm will demand twice as much labor. C) The firm will demand the same quantity of labor. D) There is not enough information to determine.