Use the information provided in Table 7.1 below to answer the ...

[HCHenry]

Question 1

An act of production, as economists use the term, is demonstrated by which of the following?

◦ A worker places money in a pension fund.
◦ A local nonprofessional theater company performs a play.
◦ An individual buys municipal bonds to avoid taxes.
◦ A firm buys a pre-existing building in order to expand its operations.

Question 2

Use the information provided in Table 7.1 below to answer the question(s) that follow. 

Refer to Table 7.1. Which technology is the most labor intensive?

◦ A
◦ B
◦ C
◦ D

[af]

Answer 1

A local nonprofessional theater company performs a play.

Answer 2

A

[RRMR]

Question 1

Use the information provided in Table 7.1 below to answer the question(s) that follow. 

Refer to Table 7.1. Which technology is the most capital intensive?

◦ A
◦ B
◦ C
◦ D

Question 2

Use the information provided in Table 7.1 below to answer the question(s) that follow. 

Refer to Table 7.1. If the hourly wage rate is $7 and the hourly price of capital is $10, which production technology should be selected?

◦ A
◦ B
◦ C
◦ D

[alvinum]

Answer 1

D

Answer 2

C

[RRMR]

TY

[alvinum]

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