The Coase Theorem implies that _____
a. absent transactions costs, resources will be efficiently allocated
b. absent transactions costs, resources will be inefficiently allocated
c. with significant transactions costs, resources will be efficiently allocated
d. with significant transactions costs, resources will be inefficiently allocated
a
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Which of the following statements is true of the long run?
A) Identical firms can enjoy positive economic profits. B) Identical firms face an upward-sloping supply curve. C) Non-identical firms can enjoy positive economic profits. D) Non-identical firms face a horizontal supply curve.
Suppose the production of mp3 players can be represented by the following production function: q = L0.4K0.4. The firm currently produces q1 units. If all inputs doubled, the new level of output will equal
A) 20.4 q1. B) 20.8 q1. C) 0.8 q1. D) 1.6 q1.