In terms of price indexes, what is a COLA?
a. A measure of the quality of living
b. A consumer price adjustment
c. An increase in wages designed to match consumer price increases
d. An estimate of gross domestic product
e. A measure of producer surplus
c
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Suppose that for Jason the marginal utility of $50-per-serving caviar is 100 and the marginal utility of $1-per-serving popcorn is 10 . For his snack, Jason should buy
a. the caviar if he has the $50; otherwise the popcorn b. the caviar if he has the $50; otherwise nothing c. the popcorn, whether he has the $50 or not d. one serving each of the caviar and popcorn, if he has $51 e. five servings of popcorn for each serving of caviar
A perfectly competitive firm faces a market clearing price of $150 per unit. Average total costs are at the minimum value of $200 per unit at an output rate of 100 units. Average variable costs are at the minimum value of $100 per unit at an output rate of 50 units. Marginal cost equals $150 per unit at an output rate of 75 units. It can be concluded that the short-run profit-maximizing output rate is
A. 75 units, at which the firm earns positive economic profits per unit sold. B. 50 units, because price is less than average variable costs. C. 75 units, at which the firm earns zero economic profits per unit sold. D. 75 units, at which the firm earns negative economic profits per unit sold.