Question

MCQs: 1. A firm is said to be earning normal profit whenever: A. Accounting profit is zero B. Economic profit is positive C. Accounting profit is positive D. Total revenue equals explicit and implicit costs. 2. If a 10% increase in inputs results in a 20% increase in output, then the firm is said to exhibit: A. Diseconomies of scale B. Diminishing marginal returns to scale C. Constant returns to scale D. Economies of scale. Economists have traditionally attempted to avoid the trap of: A. Thinking in terms of total utility B. Computing marginal utility C. Making interpersonal utility comparisons D. None of the above. According to the water-diamond paradox: A. Water has lower MU than Diamond B. Water has higher TU than Diamond C. Prices reflect MU and not TU D. All of the above.

          MCQs:
1. A firm is said to be earning normal profit whenever: A. Accounting profit is zero B. Economic profit is positive C. Accounting profit is positive D. Total revenue equals explicit and implicit costs.
2. If a 10% increase in inputs results in a 20% increase in output, then the firm is said to exhibit: A. Diseconomies of scale B. Diminishing marginal returns to scale C. Constant returns to scale D. Economies of scale.
Economists have traditionally attempted to avoid the trap of: A. Thinking in terms of total utility B. Computing marginal utility C. Making interpersonal utility comparisons D. None of the above.
According to the water-diamond paradox: A. Water has lower MU than Diamond B. Water has higher TU than Diamond C. Prices reflect MU and not TU D. All of the above.

Added by Amanda M.

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