Given MU1/P1 > MU2/P2 and MU1 = MU2, how could you create a state of consumer equilibrium?
a. Make P1 equal to P2.
b. Make MU1 greater than MU2.
c. Make P1 less than P2.
d. Make MU1 greater than P2.
a. Make P1 equal to P2.
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In San Francisco there are many restaurants that specialize in a wide variety of cuisines. Patronage at these restaurants is influenced by factors such as tastes, price, and location. This market is
A) monopolistically competitive. B) oligopolistic. C) monopolistic. D) perfectly competitive.
Which of the following is NOT a way to signal high quality
a. wearing a business suit on a job interview b. leaving a big tip for the waiter after a dinner date c. offering an expensive engagement ring to your bride d. Doing messy chores before a big date
The term used to describe a situation in which markets do not allocate resources efficiently is
a. economic meltdown. b. market failure. c. equilibrium. d. the effect of the invisible hand.
Suppose a small island nation imports sugar for its population at the world price of $1,500 per ton. The domestic market for sugar is shown below.
If the government provides a subsidy of $500 per ton, then the cost of subsidy, which must be borne by taxpayers, will be ________ per day.
A. $2,000 B. $5,000 C. $6,000 D. $500