A person will pay $1,000 (and not more) extra for a bigger car that he or she feels is safer. This car will reduce the chance of dying in an automobile accident by 1/550. That means that the buyer is implicitly valuing his or her life at roughly:
A. $55,000.
B. $5,500.
C. $5,500,000.
D. $550,000.
Answer: D
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If the university administration plans to hike tuition charges in the hope of increasing tuition revenues, we know
A) they are assuming an elastic demand. B) they are assuming an inelastic demand. C) they cannot succeed because of the law of demand. D) they must be running in the red. E) they will only succeed if more students can be enrolled at no cost.
The racial profile of colonial South Carolina:
a. was typical of the colonies as a whole. b. was closer to that of the French and British West Indies than to that of its neighboring colonies. c. was dominated by whites until nearly 1750. d. indicates that it had a higher concentration of blacks than any colony except Virginia.
A monopolistically competitive industry is characterized by
a. many firms selling products that are similar but not identical. b. many firms selling identical products. c. a few firms selling products that are similar but not identical. d. a few firms selling highly different products.
Define the term scarcity and discuss two of its consequences