This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: If the production of a good involves negative externalities, ________. A) the quantity of the ... (Read 77 times)

londonang

  • Hero Member
  • *****
  • Posts: 540
on: Jun 29, 2018
If the production of a good involves negative externalities, ________.
 
  A) the quantity of the good supplied in the market is lower than the efficient level
  B) the optimal price of the good is higher than the price charged in the market
  C) total welfare can be increased by increasing the production of the good
  D) average cost of production can be reduced by increasing output above the optimal level

Question 2

Explain how the real wage and the extra output produced by each worker determine the quantity of labor demanded by a firm.
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

k2629

  • Sr. Member
  • ****
  • Posts: 357
Reply #1 on: Jun 29, 2018
Answer to Question 1

B

Answer to Question 2

The firm compares the cost of hiring an extra worker (the real wage) to the benefit (the extra output produced by an extra worker). Because the firm wants to make a profit, it hires the worker as long as the extra output is greater than the real wage. Thus the firm will demand (hire) the quantity of workers such that the extra output produced by the worker is greater than or equal to the real wage rate. Because labor has diminishing returns, there is some point at which the last worker hired produces just enough output to justify the wage rate and so additional workers will not be hired.


londonang

  • Member
  • Posts: 540
Reply 2 on: Jun 29, 2018
Great answer, keep it coming :)

irishcancer18

  • Member
  • Posts: 310
Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

« previous next »
 

Did you know?

Cutaneous mucormycosis is a rare fungal infection that has been fatal in at least 29% of cases, and in as many as 83% of cases, depending on the patient's health prior to infection. It has occurred often after natural disasters such as tornados, and early treatment is essential.

Did you know?

As of mid-2016, 18.2 million people were receiving advanced retroviral therapy (ART) worldwide. This represents between 43–50% of the 34–39.8 million people living with HIV.

Did you know?

Blastomycosis is often misdiagnosed, resulting in tragic outcomes. It is caused by a fungus living in moist soil, in wooded areas of the United States and Canada. If inhaled, the fungus can cause mild breathing problems that may worsen and cause serious illness and even death.

Did you know?

Drug abusers experience the following scenario: The pleasure given by their drug (or drugs) of choice is so strong that it is difficult to eradicate even after years of staying away from the substances involved. Certain triggers may cause a drug abuser to relapse. Research shows that long-term drug abuse results in significant changes in brain function that persist long after an individual stops using drugs. It is most important to realize that the same is true of not just illegal substances but alcohol and tobacco as well.

Did you know?

Many supplement containers do not even contain what their labels say. There are many documented reports of products containing much less, or more, that what is listed on their labels. They may also contain undisclosed prescription drugs and even contaminants.

One target for expanding medical services involves vaccinations. Only 78 percent of children ages 19 ... One target for expanding medical services involves vaccinations. Only 78 percent of children ages 19 ...
Negative feedback control of a regulated variable. Negative feedback control of a regulated variable.
A good posture for practicing meditation is seated in a chair with the back upright and in ... A good posture for practicing meditation is seated in a chair with the back upright and in ...
Good body mechanics for sitting on chair while performing massage. A. Sit with back and head in ... Good body mechanics for sitting on chair while performing massage. A. Sit with back and head in ...
Products like Beano contain enzymes that help reduce the production of gas in the large intestine Products like Beano contain enzymes that help reduce the production of gas in the large intestine
Production of ATP in Skeletal Muscle Production of ATP in Skeletal Muscle
Video: DNA Sequences - Dideoxy Sequencing

For a complete list of videos, visit our video library