The $14.3 billion U.S. craft beer market is being subsidized at local, state, and even federal government levels, and the taxpayers pay for these subsidies. Economists know that these subsidies make Americans poorer on the whole
Why is it so difficult for U.S. taxpayers to end these subsidies for the craft beer market, a market which has been described as "booming" and "highly successful"?
Because the benefits of these subsidies are concentrated within the craft beer industry, interest groups and politicians have an incentive to spend a lot of time and political energy fighting for them, even when they cost taxpayers and are welfare destroying on the whole. Because the costs are diffuse, taxpayers rarely find complaining worth their while. Because of transactions costs, organizing taxpayers is difficult, and as a result, subsidies such as these often are approved even when they make everyone collectively poorer.
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If 80,000 people want tickets to the World Series at the current price, and there are only 55,000 tickets available,
A) the cost of obtaining a ticket for someone who doesn't yet have one will be greater than the price stamped on its face. B) the demand for tickets is highly elastic. C) the price is too low. D) the quantity purchased will be greater than the quantity supplied.
A firm in a competitive industry faces a market price for output of $25 and a wage rate of $750. At the current level of employment (50 units of labor), the marginal product of labor is 20. In order to maximize profit, the firm should
A. keep the level of employment the same because the firm is earning a profit of $500. B. hire less labor because the firm is suffering a loss of $12,500. C. hire more labor because hiring another unit of labor would increase profit by $500. D. hire less labor because hiring the last unit of labor decreased profit by 250.
To answer the question, refer to the following table showing a demand schedule: 
If price falls from $150 to $100,
A. an arrow representing the price effect points down and is shorter than an arrow for the quantity effect. B. arrows representing the price and quantity effects both point down. C. total revenue moves in the same direction as the arrow representing the price effect. D. the arrow representing the price effect points down and the arrow representing the quantity effect points up. E. both c and d
Which of the following is not a characteristic of a competitive market?
A. A large number of buyers and sellers. B. Firms can enter and exit the market freely. C. Firms sell differentiated products. D. All market participants have full information about cost and prices.