Answer the question on the basis of the following information: Harry owns a barber shop and charges $6 per haircut. By hiring one barber at $10 per hour, the shop can provide 24 haircuts per eight-hour day. By hiring a second barber at the same wage
rate, the shop can now provide a total of 42 haircuts per day. Refer to the given information. The MRP of the second barber is:
A. 18 haircuts.
B. $108.
C. 42 haircuts.
D. $126.
Answer: B
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According to ________, when real GDP is ________ percentage points greater than potential GDP, the unemployment rate is one percentage point ________ the natural unemployment rate
A) Okun's Law; four; below B) Keynes' Law; two; below C) Phillip's Law; four; above D) Say's Law; two; above E) Okun's Law; two; below
The difference between cost-of-service regulation and rate-of-return regulation is that
A) the former sets prices based on actual costs, and the latter focuses on setting prices such that the firm earns a normal rate of return. B) the latter sets prices first, and then the firm must keep costs in line if it wants to earn a profit, and the former sets price high enough to cover costs. C) the former uses marginal cost pricing and the latter uses average cost pricing. D) the former uses average cost pricing and the latter uses marginal cost pricing.