When a firm experiences declining long-run average total costs as it produces more output, there are
A) increasing marginal returns to variable inputs.
B) economies of scale.
C) diseconomies of scale.
D) constant returns to scale.
B
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Refer to Table 16-3. Suppose Julie's marginal cost of providing this service is constant at $7 and she decides to charge each customer according to his or her willingness to pay
What is Julie's total revenue and how many hours of service will be purchased? A) 1 hour and her total revenue = $7 B) 4 hours and her total revenue = $39 C) 4 hours and her total revenue = $28 D) 5 hours and her total revenue = $35
A Giffen good is one for which the quantity demanded rises as the price rises because the income effect
a. reinforces the substitution effect. b. reinforces and is greater than the substitution effect. c. counteracts but is smaller than the substitution effect. d. counteracts and is greater than the substitution effect.