A ___________is a government payment to an individual, business, or other group to encourage or protect a certain type of economic activity.

If both the marginal cost and the average variable cost curves are U-shaped. At the minimum point on the average variable cost curve, the marginal cost must be:

a. greater than the average variable cost. b. less than the average variable cost. c. equal to the average variable cost. d. at its minimum.

Consternation Corporation has an agreement with its workers to index completely the wage of its employees using the CPI. Consternation Corporation currently pays its production line workers $8.00 an hour and is scheduled to index their wages today. If the CPI is currently 160 and was 128 a year ago, the firm should increase the hourly wages of its workers by

a. $0.25. b. $1.60. c. $2.00. d. $2.56.