If a nondiscriminating pure monopolist decides to sell one more unit of output, the marginal revenue associated with that unit will be:
A. equal to its price.
B. the price at which that unit is sold less the price reductions that apply to all other units of
output.
C. the price at which that unit is sold plus the price increases that apply to all other units of
output.
D. indeterminate unless marginal cost data are known.
Answer: B
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A) to determine what items are subject to sales taxes. B) by taxpayers to reduce the amount of income subject to tax. C) to add to taxes that must be paid. D) to determine the type of tax structure.
A free rider is a person who
a. is harmed by another's actions b. is subject to a negative externality c. receives benefits from someone else's market activity but does not pay for them d. pays less than the full value for a good e. wins the state lottery on a ticket he found
According to the classical model, both prices and nominal income would double if the quantity of money
a) doubled. b) remained constant. c) tripled. d) halved.
One reason that the quantity demanded of a good increases when its price falls is that the:
A. price decline shifts the supply curve to the left. B. lower price increases the real incomes of buyers, enabling them to buy more. C. lower price shifts the demand curve to the left. D. lower price shifts the demand curve to the right.