For a perfectly competitive firm, the profit-maximizing output level occurs where marginal cost equals price.
Answer the following statement true (T) or false (F)
True
If price exceeds marginal cost, a firm can increase its profits by selling additional output. If price is less than marginal cost, a firm can increase its profits by selling less output.
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In the figure above, the richest 20 percent of households receive ________ of total income
A) 55 percent B) 45 percent C) 80 percent D) 60 percent
The combined effect of a real wage increase is that
A) the income effect always dominates, leading to fewer hours worked at a higher wage. B) the substitution effect always dominates, leading to more hours worked at a higher wage. C) if the substitution effect outweighs the income effect, the labor supply curve slopes downward, but if the income effect outweighs the substitution effect, the labor supply curve slopes upward. D) if the substitution effect outweighs the income effect, the labor supply curve slopes upward, but if the income effect outweighs the substitution effect, the labor supply curve slopes downward.