If the value that consumers place on the 100th unit of chocolate is $5, and the value of the resources used to produce that 100th unit is $2, to achieve an efficient allocation of resources
a. a $3 externality associated with chocolate production must be generated
b. a $3 externality associated with chocolate production must be eliminated
c. less resources should be allocated to chocolate production
d. more chocolate should be produced
e. less chocolate should be produced
D
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The Herfindahl-Hirschman Index is used to ________
A) measure the price elasticity of demand faced by a firm B) estimate the degree of competition in an industry C) measure the price elasticity of market supply in an industry D) estimate the profit earned by firms in an industry
Under a fixed exchange rate regime, what will happen to the balance of payments for the United States and Mexico when the demand for Mexican goods rises? What is the only possible solution to this problem, given the fixed exchange rate?
What will be an ideal response?
Would you expect a tax on cigarettes to be more effective at discouraging consumption over the long run or the short run?
A. Short run because demand becomes more elastic over time B. Long run because demand becomes less elastic over time C. Short run because demand becomes less elastic over time D. Long run because demand becomes more elastic over time
If there are two goods and two countries, then one country can have
A. a comparative advantage in both goods. B. a higher opportunity cost of producing both goods. C. a lower opportunity cost of producing both goods. D. a comparative advantage in only one good.