See the information in Scenario 4.4. Suppose that the price should increase slightly from $10, how will this affect the total expenditure of consumers on the game? A) Total expenditures will increase. B) Total expenditures will not change. C) Total expenditures will decrease by a larger percentage than the price increase. D) Total expenditures will […]
Which of the following statements identifies a key difference between condominiums and cooperative housing? A) Condos tends to be less expensive. B) Condo owners are not responsible for maintaining the common spaces in the building. C) Co-op owners have more control over who can move into their building. D) Co-op owners generally commit less time […]
Given the information in Figure 14.4, the competitive wage rate is: A) W1. B) W2. C) W3. D) W4. E) none of the above ANSWER B
The benefit of a subsidy accrues mostly to consumers A) in every instance. B) if Ed/Es is large. C) if Ed/Es is small. D) if Ed and Es are equal. E) in no instance. ANSWER C
Which of the following statements represents a key point about strategic decision making? A) Strategy is less important in nonconstant sum games than in constant sum games. B) The payoffs in cooperative games will always be higher than in noncooperative games. C) It is essential to understand your opponent’s point of view and to deduce […]
An economy produces outputs X and Y using inputs L and K. Which of the following is NOT required for economic efficiency? A) MRTSLK = MRSXY for all producers and consumers. B) MRTXY = MRSXY for all producers and consumers. C) MRSXY is equal for all consumers. D) MRTSLK is equal for all producers. E) […]
Use the following statements to answer the question: I. Consider the problem of negotiating the price of a rug that costs $100 to make. If there are two buyers (one with a maximum willingness-to-pay of $200 and one with a maximum willingness-to-pay of $250 ), then the situation is no longer a constant sum game. […]
Which of the following conditions must hold in the equilibrium of a competitive market where the government puts a specific tax on consumers? A) The quantity sold and the price paid by the buyer must lie on the demand curve. B) The quantity sold and the seller’s price must lie on the supply curve. C) […]
Given the information in Figure 14.4, the monopoly wage rate is: A) W1. B) W2. C) W3. D) W4. E) none of the above ANSWER C
In many rural areas, electric generation and distribution utilities were initially set up as cooperatives in which the electricity customers were member-owners. Like most cooperatives, the objective of these firms was to: A) maximize profits for the member-owners. B) maximize total revenue that could be redistributed to the member-owners. C) operate at zero profit in […]
