The government proposes a tax on halogen light bulbs. Sellers will bear the entire burden of the tax if the
A) demand curve is downward sloping and the supply curve is upward sloping.
B) demand curve for halogen bulbs is horizontal.
C) demand curve for halogen bulbs is vertical.
D) supply curve of halogen bulbs is horizontal.
B
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Mexico and the members of OPEC produce crude oil. Realizing that it would be in their best interests to form an agreement on production goals, a meeting is arranged and an informal, verbal agreement is reached. If both Mexico and OPEC abide by the agreement, then OPEC's profit will be $200 million and Mexico's profit will be $100 million. If both Mexico and OPEC cheat on the agreement, then OPEC's profit will be $175 million and Mexico's profit will be $80 million. If only OPEC cheats, then OPEC's profit will be $185 million, and Mexico's profit will be $60 million. If only Mexico cheats, then Mexico's profit will be $110 million, and OPEC's profit will be $150 million. You may find it helpful to fill in the payoff matrix below. src="https://sciemce.com/media/4/ppg__rrr0818190951__f1q383g1.jpg" alt="" style="vertical-align: 0.0px;" height="203" width="377" />Which of the following statements is correct?
A. OPEC's dominant strategy is to cheat on the agreement.
B. OPEC's dominated strategy is to cheat on the agreement.
C. OPEC's dominant strategy is to abide by the agreement.
D. OPEC does not have dominant strategy.
If property rights are not well enforced, all of the following are likely to occur except
A) a significant number of people will be willing to risk their funds by investing them in local businesses. B) economic efficiency will be reduced. C) an economy will produce inside its production possibilities frontier. D) fewer goods and services will be produced.
The deadweight loss of taxation from an income tax is because of _____
a. the inclusion of savings in the tax base b. the Laffer curve c. the income effect d. the substitution effect
Many experts believe that the major determinant of exchange rates in the short run is relative
a. price levels. b. income levels. c. money supplies. d. interest rates.