If the producer of an information product engages in marginal cost pricing, it earns
A. zero economic profits.
B. negative economic profits.
C. positive economic profits.
D. a normal profit.
Answer: B
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Suppose that the production function for the economy is Y = AK1/4L3/4. Assume that real GDP is $8,000 billion, capital stock is $32,000 billion, and the labor supply is 120 million (or 0.120 billion) workers
Total factor productivity for this economy is A) 16.50 B) 1,016.52 C) 2,083.33 D) 2,933.65
In an efficient economy,
a. no one could be made better off by a change in the way goods are allocated b. revenue for all firms is maximized c. a change in the way goods are allocated could make someone worse off d. goods are allocated fairly among individuals e. no one would be made worse off if there is a change in the way goods are allocated