Luxury goods are
a. price inelastic
b. income inelastic
c. income elastic
d. goods with negative income elasticity
e. goods with positive price elasticity
C
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An internal economies of scale is defined as
A) one whose size or scale effects are not located in the firm, but in the industry. B) one with falling costs over a specific level of output. C) one with falling costs over a relatively large range of output. D) one with falling costs over a relatively large range of output, but definite declining profits.
A minimum wage law is an example of a price floor
Indicate whether the statement is true or false
Suppose there are two small island countries: Avarice, which is populated by people who are completely self-interested, and Altruism, which is populated by people who have adopted social norms of generosity and cooperation. Suppose residents of each island often play prisoner's dilemma games, always matched with a person from the same island, but not a person who they know or will play with again. If the same number of games is played on each island, you would expect:
A. players on both islands to quickly converge to playing their dominant strategies. B. the residents of Altruism to have higher average payoffs than the residents of Avarice. C. players on both islands to quickly converge to playing their dominated strategies. D. the residents of Avarice to have higher average payoffs than the residents of Altruism.
Net wealth is _____
Fill in the blank(s) with the appropriate word(s).