Which of the following describes a difference between the marginal product of labor and the marginal revenue product of labor?
A) The marginal product of labor declines as each additional worker is hired because of the law of diminishing returns. The marginal revenue product of labor declines as each additional worker is hired because of diseconomies of scale.
B) The marginal product of labor is inelastic. The marginal revenue product of labor is elastic.
C) The marginal product of labor declines as each additional worker is hired because of the law of diminishing returns. The marginal revenue product increases as each additional worker is hired because of increases in the productivity of labor.
D) The marginal product of labor measures the change in output as additional workers are hired. The marginal revenue product measures the change in revenue as additional workers are hired.
D
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A firm is indifferent between staying in business and shutting down in the short run when, at the loss-minimizing level of output,
a. total revenue equals total cost b. average total cost is at its minimum c. total revenue exceeds total cost d. total revenue equals total variable cost e. total variable cost equals total cost
Assume that the central bank lowers the discount to increase the nation's monetary base. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the current international transactions balance and monetary base in the context of the Three-Sector-Model? State your answer after the macroeconomic system returns to complete equilibrium
a. The current international transactions balance rises and monetary base rises. b. The current international transactions balance rises and monetary base falls. c. The current international transactions balance and monetary base fall. d. The current international transactions balance and monetary base remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.