The Acme Oil Company is a vertically integrated firm. It explores for and extracts crude oil. It also refines the crude oil into gasoline and other products, and sells these products to consumers. The internal price that Acme Oil uses when the crude oil that it extracts is “sold” to one of its refineries is […]
Date: September 9th, 2020
Suppose that three oligopolistic firms are currently charging $12 for their product. The three firms are about the same size. Firm A decides to raise its price to $18, and announces to the press that it is doing so because higher prices are needed to restore economic vitality to the industry. Firms B and C […]
Date: September 9th, 2020
When new technologies make cleaner production possible, A) emissions would fall under a system of fees, but would not fall under a system of transferable emissions permits unless the government bought back some of the permits. B) emissions would fall under a system of permits, but would not fall under a system of fees unless […]
Date: September 9th, 2020
Locating a point on a utilities possibilities frontier gives you information about A) both equity and efficiency. B) equity but not efficiency. C) efficiency but not equity. D) profitability but not efficiency. ANSWER C
Date: September 9th, 2020
You have just won a cash award of $500 for academic excellence. A) The substitution effect of this award will be larger than its income effect. B) The income effect of this award will be larger than its substitution effect. C) The substitution and income effects will be of identical size. D) It is impossible […]
Date: September 9th, 2020
Which major asset experienced a price bubble just before the housing price bubble of 2006-2009? A) Internet or tech-stocks B) Tulip bulbs C) Japanese real estate D) Railroad stocks ANSWER A
Date: September 9th, 2020
The scale economies index (SCI) is equal to: A) the cost-output elasticity. B) one minus the cost-output elasticity. C) 100 times the degree of economies of scope (SC). D) marginal cost divided by average cost. ANSWER B
Date: September 9th, 2020
See Scenario 4.1. What quantity Qc will maximize Daniel’s utility given the information above? A) 0 B) 24 C) 40 D) 60 E) none of the above ANSWER C
Date: September 9th, 2020
Refer to Figure 9.7. Because of the policy, consumer surplus fell by A) $10. B) $20. C) $12,500. D) $25,000. E) $45,000. ANSWER D
Date: September 9th, 2020
Refer to Figure 9.7. After the policy was implemented, price became A) $10. B) $30. C) $50. D) $70. E) between $50 and $70, but the price is uncertain because quantity can be any amount between 2000 and 4000. ANSWER C
Date: September 9th, 2020
