Use the following graph to answer the next question.
A 3% general sales tax would have a structure that is illustrated by
A. curve A.
B. curve B.
C. curve C.
D. none of the curves.
Answer: A
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"Economic exploitation" is measured by:
a. the sum of all input costs, both direct and indirect. b. the difference between the value of output a worker adds and what she receives. c. the difference between a monopoly's profit and the profit of a competitive firm. d. the average wage of a skilled worker divided by the average wage of an unskilled worker.
A monopoly sets a market price that is higher than the marginal cost of production. This fact implies that a monopoly's allocation of resources is:
a. unfair. b. inefficient. c. discriminatory. d. excessive.
Price discrimination allows a monopolist to make higher profits.
Answer the following statement true (T) or false (F)
All economists believe that:
A. assumptions are irrelevant to the outcome of a model. B. people are selfish. C. people follow principles of enlightened self-interest. D. incentives are important.