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Question: 1 an increase in employerpaid pension costs will decrease the...

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1.   An increase in employer-paid pension costs will decrease the:

 

(a)   supply of workers. 

 

(b)  quantity supplied of workers. 

 

(c)   quantity demanded of workers. 

 

(d)  demand for workers. 

 

 

2.   The production function Q = -64X0.5Y0.4 exhibits: 

 

(a)   constant returns to scale. 

 

(b)  increasing returns to scale. 

 

(c)   diminishing returns to scale. 

 

(d)  increasing and then diminishing returns to scale. 

 

 

 

3.   If PX = €60,000, MPX = 300 and MRQ = €250, the marginal revenue product of X equals:

 

(a)   €75,000. 

 

(b)  300. 

 

(c)   €250. 

 

(d)  €60,000. 

 

 

 

 

 

 

4.   Minimum efficient scale will decrease if: 

 

(a)   fixed costs increase. 

 

(b)  transportation costs increase in relation to production costs. 

 

(c)   transportation costs decrease in relation to production costs. 

 

(d)  variable costs decrease. 

 

 

5.      If the slope of a long-run total cost function increases as output increases, the firm's underlying production function exhibits:

 

(a)   constant returns to scale. 

 

(b)  decreasing returns to scale. 

 

(c)   decreasing returns to a factor input. 

 

(d)  increasing returns to scale. 

 

 

6.      Assume the following for a firm:

 

Demand function:  P= 53- Q

Total Revenue function: TR= 53- Q^2

Marginal Revenue: MR= 53- 2Q

Total cost function: TC= 1000 + 5Q + Q^2 

Marginal cost function: MC= 5+ 2Q

Average cost function: AC= 1000/Q + 5 + Q

 

The profit maximising level of output will be:

 

(a)   11 

 

(b)  12

 

(c)   13 

 

(d)  14 

 

 

7.      Using the profit maximising level from the previous question above, the profit maximising Total Revenue will be:

 

(a)   492 

 

(b)  352

 

(c)   406 

 

(d)  390

 

 

 

8.      When demand is perfectly elastic, regulatory costs are never borne by:

 

(a)   consumers. 

 

(b)  management. 

 

(c)   stockholders. 

 

(d)  government. 

 

 

9.      The desirability of maintaining a reputation for selling high-quality goods and services is minimal in the case of:

 

(a)   a finitely repeated game with known duration. 

 

(b)  a finitely repeated game of unknown duration. 

 

(c)   an infinitely repeated game. 

 

(d)  none of these. 

 

 

 

10.   In the risk-adjusted discount rate approach, increasing risk aversion is reflected in a cost of capital that exceeds the:

 

(a)   risk-free rate. 

 

(b)  risk free rate and falls with increasing risk. 

 

(c)   risk free rate and falls with decreasing risk. 

 

(d)  none of these. 

 

 

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