If the government did not provide and subsidize education:
A. parents would acquire less education for their children than is efficient because some of the benefits of education are private and some are social.
B. parents would acquire the efficient quantity of education for their children, because all of the benefits of education are private.
C. no children would receive an education because the benefits of education are public goods.
D. the education market would reach efficiency.
Answer: A
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Refer to Figure 9.3. If the government establishes a price ceiling of $1.00, consumer surplus will
A) fall by $50. B) fall by $150. C) remain the same. D) rise by $50. E) rise by $150.
Assume that a monopolist faces a linear demand curve. If the firm is operating at an output level where marginal revenue is positive, the firm:
A. Has maximized total revenues B. Could raise revenues by raising prices C. Can always increase profits by lowering its price D. Is operating on the elastic portion of its demand curve
With an increase in the capital stock, the short-run aggregate supply curve
A) remains as it is. B) shifts rightward. C) shifts leftward. D) becomes steeper.
If the price of a barrel of oil is $100 this year and the interest rate is 10 percent, then according to the Hotelling Principle the price next year is expected to be ________ per barrel
A) $90 B) $110 C) $100 D) None of the above is correct.