A deadweight loss decreases in size when a unit of output is produced for which
A. producer surplus exceeds consumer surplus.
B. marginal cost exceeds marginal benefit.
C. consumer surplus exceeds producer surplus.
D. maximum willingness to pay exceeds minimum acceptable price.
Answer: D
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Using Scenario 1 calculate the total cost of pollution when both steel companies are allowed to pollute only one million gallons of thermal water each but the rights to pollute are genuine property rights sanctioned and protected by the government
and therefore tradable.
A game in which all the players are worse off at the end of the game is a
A) negative-sum game. B) dominant strategy game. C) positive-sum game. D) noncooperative game.
According to the text, the most important of the five factors which give rise to monopoly is
A. economies of scale. B. patents. C. exclusive control over important inputs. D. network economies. E. government licenses.
If the Fed decreases the reserve requirement, it will likely:
A. decrease the amount of excess reserves which will eventually decrease the money supply. B. increase the amount of excess reserves which will eventually increase the money supply. C. increase the amount of excess reserves which will eventually decrease the money supply. D. decrease the amount of excess reserves, which will eventually increase the money supply.