Although the long-run equilibrium price of oil is 80 per barrel, some producers have much lower costs because their oil reserves are relatively close to the surface and are easier to extract.
If the low-cost producers have a minimum LAC equal to 20 per barrel, then the difference (60 per barrel) is: A) an above-normal economic profit.
B) an economic rent due to the scarcity of low-cost oil reserves.
C) a profit that will go to zero as new oil producers enter the market.
D) none of the above
Question 2
What is the problem with paying plant managers in multi-plant firms according to the level of output they produce?
A) Managers in low-cost or high-capacity plants could be penalized, in percentage terms, for their overproduction.
B) The production problem in multi-plant firms is usually how to lower production to increase market power, not how to increase production.
C) Managers in high-cost or low-capacity plants could be penalized for production constraints over which they have no control.
D) Managers would have an incentive to understate the productive capacity of their plants.
E) Managers would have an incentive to overstate the productive capacity of their plants.
Woman (formerly a.k.a. the Venus of Willendorf), Lower Austria.
A horizontally opposed engine design helps to lower the vehicle’s center of gravity.
Long-Range Forecasts
Use palms and fingers to brush off along the back of the body from shoulders to feet with long ...
Apply the body wrap substance to the back with long, smooth strokes, covering the area thoroughly.
Hardy–Weinberg Equilibrium Genotype Frequencies for Three Alleles of a Gene