The portion of consumer surplus that would have existed in a perfectly competitive market but is unobtainable by anyone in society under a monopoly is known as
A) monopoly profits.
B) an unattainable surplus.
C) a deadweight loss.
D) an external cost.
Answer: C
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If inflation is positive and is perfectly anticipated
A) those that lend money lose. B) no one in the economy loses. C) those that borrow money lose. D) those that hold paper money lose.
When external benefits are present in a market,
a. less of the good will be produced than the amount consistent with economic efficiency. b. more of the good will be produced than the amount consistent with economic efficiency. c. the amount of the good produced will be equal to the amount consistent with economic efficiency. d. corresponding external costs are always generated.
Tony notes that an electronics store is offering a flat $20 off all prices in the store. Tony reasons that if he wants to buy something with a price of $50, then it is a good offer, but if he wants to buy something with a price of $500, then it is not a good offer. This is an example of:
A. inconsistent reasoning because prices are sunk costs. B. inconsistent reasoning; saving $20 is saving $20. C. rational choice because saving 40 percent is better than saving 4 percent. D. the proper application of the Cost-Benefit Principle.
Suppose that the quantity of hamburgers is measured along the vertical axis and that the quantity of popcorn is measured along the horizontal axis. The vertical intercept is 10 hamburgers, and the slope of the budget line is -2. If the price of popcorn
falls from $1 to $0.50, then we know that A) the vertical intercept shifts to 20 hamburgers. B) the vertical intercept shifts to 5 hamburgers. C) the horizontal intercept shifts to 10 bags of popcorn. D) the horizontal intercept shifts to 20 bags of popcorn.