Hot dog vendors on the beach fail to cooperate with one another on the quantity of hot dogs they should sell to earn monopoly profits. A consequence of their failure is that, relative to the outcome the vendors would like, (i) the quantity of hot dogs supplied is closer to the socially optimal level. (ii) the price of hot dogs is closer to marginal cost. (iii) the hot dog market at the beach is
less competitive.
a. (i) and (ii)
b. (ii) and (iii)
c. (i) and (iii)
d. (iii) only
a
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Which statement is a good argument in support of policy activism?
A) Policy lags are generally longer than the time it takes the self-correcting mechanism to work. B) Activist policies help to ensure stability of the real interest rate. C) Well-considered policies can assist the economy's self-correcting mechanism, thus reducing the variability of inflation and unemployment. D) all of the above E) none of the above
What is meant by the term "tax incidence"? What is the tax incidence of the personal income tax? What is the tax incidence of the corporate income tax?
What will be an ideal response?
If a country has a fixed exchange rate, it:
A. has a value that is set by the government. B. helps attract foreign investment and gives businesses that depend on overseas trade more confidence to invest. C. allows for more predictability and stability. D. All of these statements are true.
Refer to the graphs below. Which graph shows an increase in the price of X and a decrease in the price of Y?
A. Graph A
B. Graph B
C. Graph C
D. Graph D