Exam 10: Organizing Production

-The table above lists the market shares of the twenty makers of personal computers. The Herfindahl-Hirschman Index for this industry equals

Methods for making 2,000 CDs per day -In the table above, if the cost of capital is $20 per day and an hour of labor is $15 per day, which method is economically efficient?

If an industry's Herfindahl-Hirschman Index is less than 1, the industry is likely to be

Which of the following types of business organization have limited liability? I. proprietorship II) partnership III) corporation

Which of the following firms has unlimited liability?

Firm A can produce a unit of output with 10 hours of labor and 5 units of material. Firm B can produce a unit of output with 5 hours of labor and 10 units of material. Firm C can produce a unit of output with 10 hours of labor and 10 units of material. If the prices of labor and material are $10 per hour and $5 per unit, respectively, which of these firms is the most technologically efficient?

If a market is shared equally by 100 firms, the Herfindahl-Hirschman Index is

Which of the following forms of business organization is likely to suffer most from the principal agent problem between the owners and managers of the business?

The four-firm concentration ratio equals the percentage of the value of ________ accounted for by the four ________ firms in the industry.

Which of the following correctly characterize principals and agents in important examples of the principal-agent problem?

The Herfindahl-Hirschman Index measures an industry's concentration of

The ________ the Herfindahl-Hirschman Index (HHI), the ________ the industry.

Which of the following are two components of the opportunity cost of using capital already owned by the firm?

As owner of a one-third share of a partnership, Josh is legally liable for

If 10 firms share the sales of the market equally, the four-firm concentration ratio is ________ percent.

-The table below shows four alternative techniques for assembling a car. Which of the four techniques for assembling a car cannot be economically efficient with any input prices ?

Jessica is a young doctor who has just started her own practice. Her previous position paid her $80,000 a year. For office space, she uses a building which she owns and which she has rented in the past for $40,000 a year. Her total revenue from her new practice is $250,000. She pays $50,000 to other firms for materials and supplies, and she pays $40,000 in wages to her office nurse. Assume that Jessica's building and equipment do not depreciate and that her normal profit is $20,000. a) What is the opportunity cost of all factors of production employed by Jessica? b) What is Jessica's economic profit?

Where large amounts of capital are used, the dominant form of business organization is the

Techniques for making 100 automobiles -The table above shows three production methods to produce 100 automobiles per day. Which of the three methods is technologically efficient?

A market structure in which one firm produces a good or service that has no close substitutes is called