A free-rider problem exists if
A) those consuming the good pay more than the cost of providing the good so that the producer's profits increase ("free ride") as a result of the overpayment.
B) those consuming the good pay nothing for it.
C) two consumers can jointly consume a good, which lowers the price per person.
D) a firm can obtain technology at a fair price.
B
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In the above figure, a rent ceiling of $300 per month would
A) not affect the equilibrium quantity. B) result in a surplus of 7000 units. C) result in a shortage of 7000 units. D) result in a shortage of 2000 units.
If Toby buys two goods and the prices of both goods increase by 50%
A) the budget constraint will be unchanged. B) the slope of the budget constraint stay the same. C) the slope of the budget constraint will decrease. D) the budget constraint will shift outward in a parallel fashion.
Gary buys a house for $200,000 using $10,000 of his own money and gets a mortgage for the remaining $190,000 . If the value of the house increases 7%, what will be the percentage increase in Gary's investment?
a. 25% b. 7% c. 14% d. 70% e. 140%
If a decision maker uses marginal analysis, then the relevant costs are the
A. full costs of a particular activity or product. B. fixed costs that do not vary with the extra activity or output. C. profits obtained on the activity or product. D. average costs for a particular activity or product. E. additional costs of a particular activity or product.