A Lorenz curve that is perfectly straight indicates
A) that society is very rich.
B) that a small portion of the population accounts for most of the income.
C) that a large portion of the population accounts for most of the income.
D) complete income equality.
Answer: D
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Freeways in large cities tend to be congested during rush hours to the point where offer little or no advantage over non-freeway routes because
A) drivers generally ignore marginal benefits and costs. B) drivers usually ignore marginal benefits and costs during rush hours. C) no monetary fee is charged for the use of freeways during rush hours. D) not enough freeways have been constructed due to special interests' control of the government. E) people need to get to work and the demand for freeway travel is consequently inelastic during rush hours.
Faced with an uncertain situation, the best decision for a person obeying the von-Neumann Morgenstern axioms: a. minimizes loss relative to the status quo
b. minimizes variability across possible outcomes. c. maximizes the expected payoff. d. maximizes expected utility.
A natural monopoly would benefit by being broken into many smaller firms
a. True b. False Indicate whether the statement is true or false
If a college textbook costs $80 (for a new book) at a college bookstore, the royalty paid on the book is likely
A. $9. B. $15. C. $5. D. $12.