Any movement along the production possibilities frontier involves the production of
a. more of both goods
b. more of one good and less of the other
c. less of both goods
d. more resources
e. better technology
B
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In which of the following cases does the tragedy of the commons occur? I. Cattle grazing on private ranches. II. Catching lobsters off the coast of Florida. III. Raising salmon on salmon farms. IV. Using legal services provided by the courts
A) I only B) II only C) II and III only D) I and IV only
The law of one price states that identical products should sell for the same price everywhere as long as transactions costs are zero
Indicate whether the statement is true or false
Refer to Figure 16-5. Suppose the firm represented in the diagram decides to use a two-part pricing strategy such that it charges a fixed fee and a per-unit price equal to the competitive price
(This is also called an optimal two-part tariff.) What is the per-unit price it should charge, if any? A) It should not charge a price per unit; just a flat fee to consume as much of the product as desired. B) It should charge a range of prices from $40 to $12. C) $12 D) $16
In the aggregate expenditures model, equilibrium occurs if:
a. consumption equals investment b. inventory equals investment. c. aggregate expenditures equal consumption. d. aggregate expenditures equal disposable income.