31. A resource price taker's resource demand curve is

a. horizontal

b. the same as its marginal resource cost curve

c. the same as its marginal revenue product curve

d. the same as its marginal product curve

e. the same as its average variable cost curve

32. A resource owner will supply resources up to the point where marginal resource cost is equal to marginal revenue product.

a. True

b. False

33.

A worker's labor supply depends on, among other things, his ability, his preference for the task, and the opportunity cost of his time.

a. True

b. False

34. The substitution effect in the labor supply decision refers to

a. substituting leisure for work as the wage rate rises

b. substituting market work for nonmarket work as the wage rate falls

c. working more hours as the wage rate falls

d. working fewer hours as the wage rate rises

e. substituting market work for leisure or nonmarket work as the wage rate rises

35. Exhibit 0173 shows data on the production of chocolate candy. If the firm sells chocolate for $3 a pound regardless of the quantity sold, the marginal revenue product of the third worker is

a. $0.60

b. $6

c. $0.30

d. $3

e. $90

36. Most U.S. imports are

a. manufactured goods

b. agricultural services

c. petroleum and related products

d. minerals such as bauxite and nickel

e. military goods

37. For each watch Denmark produces, it gives up the opportunity to make 50 pounds of cheese. Germany can produce one watch for every 100 pounds of cheese it produces. Which of the following is true with regard to opportunity costs in the two countries?

a. The opportunity cost of producing watches is lower in Denmark.

b. The opportunity cost of producing cheese is lower in Denmark.

c. The opportunity cost of producing watches is identical in both countries.

d. It is impossible to compare opportunity costs because the two countries use different currencies.

e. In Germany the opportunity cost of producing one pound of cheese is one watch.

38. Which of the following is true?

a. Both c and d are correct.

b. Both c and e are correct.

c. A country should specialize in production of the good in which it has the lowest opportunity cost.

d. A country should specialize in production of the good in which it has a comparative advantage.

e. A country should specialize in production in the good in which it has an absolute advantage.

39. Which of the following is not an argument in favor of restricting trade?

a. to preserve national security

b. to prevent dumping

c. to increase consumer surplus

d. to protect infant industries

e. to protect declining industries

40. In one week, Mohammed can knit 5 sweaters or bake 240 cookies. In one week, Tetah can knit 15 sweaters or bake 480 cookies. Mohammed and Tetah would produce the maximum quantities of cookies and sweaters if

a. Mohammed knitted and baked and Tetah did nothing

b. Tetah knitted and baked and Mohammed did nothing

c. Mohammed knitted and Tetah baked

d. Tetah knitted and Mohammed baked

e. Mohammed knitted and baked and Tetah just knitted