What can be said about the demand and supply of natural resources?
a. The quantity demanded of a natural resource will generally be less responsive to a change in price in the long run than in the short run.
b. The supply of a natural resource will generally be more responsive to a price change in the long run than in the short run.
c. The supply of a natural resource is fixed by nature; it cannot be responsive to a price change in the long run.
d. None of the above is correct.
D
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In long-run competitive equilibrium, the perfectly competitive firm produces where price equals minimum average total cost
a. What is this efficiency criterion called? b. How does it benefit consumers?
Suppose the production of VCRs can be represented by the following production function: q = L0.4 K0.4. Which of the following statements is (are) TRUE?
A) The production function has decreasing returns to scale. B) The marginal productivity of labor falls as labor increases in the short run. C) Capital and labor can be substituted for one another. D) All of the above.