Answer all the questions below well.

The endowment effect suggests that:

A present payoffs are endowed with more appeal relative to future payoffs.

B the value of a product is higher when it is owned than when it is being considered for

ownership.

C the utility from a product increases if other people buy it.

D the value of a product increases if it is presented in an optimistic rather than a pessimistic

way.

X1.12 Marginal cost is:

A the change in total costs when one more unit of labour is employed.

B the change in average total costs when output is expanded by one unit.

C the change in variable costs when output is expanded by one unit.

D the same as marginal revenue.

At present, Company A is producing 10 units of Good X with quantities of labour and capital such

that the marginal physical product of labour is 38 and the marginal physical product of capital is

14. The current cost of a unit of labour is $30, whereas the cost of a unit of capital is $10.

Assuming that both factors are subject to diminishing marginal returns, in order to produce

10 units of Good X as efficiently as possible, Company A should:

A use less labour and more capital.

B use more labour and less capital.

C use more labour and more capital.

D use less labour and less capital.

Which of the following is NOT a reason why economies of scale may exist?

A indivisibilities

B the division of labour

C economies of scope

D the increase in technological knowledge over time

Which of the following conditions produces normal profits?

A average revenue = marginal revenue

B average revenue = average cost

C marginal revenue = marginal cost

D average cost = marginal cost

Using the data in Exercise 10.5, and assuming a uniform distribution of all decrements in the multiple decrement model, calculate a table of q'"), j = 1, 2, k = 0, 1, 2, 3 (where k is the curtate duration). If u.)(t) is a constant c for 0