Consider Two Resource Markets in Which the Demand Curves Slope

question 85

Multiple Choice

Consider two resource markets in which the demand curves slope downward.In market A, the supply curve is horizontal, equilibrium price is $6, and 100 units of the resource are hired.In market B, the supply curve is vertical, equilibrium price is $20, and 30 units of the resource are hired.Which of the following is true?

• A)All of the resource earnings in market A are opportunity costs.
• B)All of the resource earnings in both markets are opportunity costs.
• C)All of the resource earnings in market B are opportunity costs.
• D)None of the resource earnings in either market is an opportunity cost.
• E)None of the resource earnings in either market is economic rent.

---

Definitions:

Blocking Variable

A variable used in experimental design to account for potential variation across experimental units, thereby reducing the impact of confounding variables.

Dosage Level

The amount of a substance, such as medication or chemical, administered or required to achieve a desired effect.

Randomized Block Design

A statistical design in experimental research that aims to reduce variability by grouping similar experimental units into blocks before randomly assigning treatments within each block.

LSAT Scores

Numerical scores derived from the Law School Admission Test, used to assess law school applicants' readiness for law school admissions.