Use the following statements to answer this question: I. An increase in the firm's fixed costs will also shift the firm's short-run supply curve to the left. II
An increase in the firm's fixed costs will not shift the firm's short-run supply curve to the right or left, but it may alter how much of the marginal cost curve is used to form the short-run supply curve. A) I and II are true.
B) I is true and II is false.
C) II is true and I is false.
D) I and II are false.
D
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When investment banks allocate shares of a popular but underpriced IPO to executives of other firms in order to attract their business, it is called
A) spinning. B) a bribe. C) reputational activities. D) a kickback.
Assume that a firm spends $500 on two inputs, labor (graphed on the horizontal axis) and capital (graphed on the vertical axis)
If the wage rate is $20 per hour and the rental cost of capital is $25 per hour, the slope of the isocost curve will be A) 500. B) 25/500. C) -4/5. D) 25/20 or 1.25.