Blog

The Coase theorem suggests that private markets may not be able to solve the problem of externalities   when the number of interested parties is large and bargaining costs are high if the firm in the market is a monopoly if some people benefit from the externality if the government does not become involved in the process

Table 14-3 The table represents a demand curve faced by a firm in a competitive market.     Quantity Total Revenue 0 $0 1 $13 2 $26 3 $39 4 $52   Refer to Table 14-3. For this firm, the price is $39. $26. $52. $13.

Suppose that in a competitive market the equilibrium price is $2.50. What is marginal revenue for the last unit sold by the typical firm in this market? 1. exactly $2.50 2. less than $2.50 3. more than $2.50 4. the marginal revenue cannot be determined without knowing the actual quantity sold by the typical seller    

Edward has just finished his brand-new house. The floor plan is shown below: a) Edward wants to give a tour of his house to a friend. Is it possible for them to walk through every doorway exactly once? If so, in which rooms must they begin and end the tour? Explain.b) After a few years, Edward decides to remodel. He would like to add some new doors between the rooms he has. Is it possible for each room to have an odd number of doors? Explain.

Suppose that smoking creates a negative externality. If the government does not interfere in the cigarette market, then   the quantity of cigarettes smoked will be greater than the socially optimal quantity of cigarettes the quantity of cigarettes smoked will be less than the socially optimal quantity of cigarettes the quantity of cigarettes smoked will equal the socially optimal quantity of cigarettes There is not enough information to answer the question

Income Tax rate $0 to $40,000 25% $40,000 to $100,000 40% Over $100,000 60%     Use the table above, how much income tax will you have to pay if you earned $50,000?   $14,000 $20,000   $25,000   $4,000

A production function is a relationship between inputs and   1.  quantity of output.   2.  revenue.   3.  costs.   4.  profit.

Some costs do not vary with the quantity of output produced. Those costs are called   1.  marginal costs.   2.  average costs.   3.  fixed costs.   4.  explicit costs.

Which of the following would be considered a private good?   a public beach fish in the ocean a swimming suit a ferry boat ride to an island with open seating

A good is excludable if   the government can regulate its availability it is not a normal good people can be prevented from using it one person’s use of the good diminishes another person’s enjoyment of it