Figure 6-2
illustrates the four possibilities of the structure of production and consumption for a good or service. In which case is the incentive of producers to be efficient and the incentive for consumers to economize the weakest?
a. A
b. B
c. C
d. D
d
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When a Peruvian buys a U.S. government bond, from the perspective of Peru, this is a(n):
A. capital inflow. B. export. C. capital outflow. D. import.
The distinguishing characteristic of private goods is that
A. they can be sold but not rented. B. their use is exclusive to the people who purchase them. C. the principle of rival consumption does not apply to them. D. they can be sold or rented, but not borrowed.
What is the short-run break-even price? What are economic profits at this price? Why would a firm be willing to operate permanently at this price?
What will be an ideal response?
Answer the following statement(s) true (T) or false (F)
1. If the demand curve for a good is relatively flat, a small change in price results in a relatively large change in quantity demanded 2. If safer cars reduce a driver's chance of dying in an accident, then there will be fewer driver fatalities. 3. If one wants to apply the theoretical side of economics by examining data, they use a family of statistical techniques called econometrics. 4. A sales tax causes the demand curve to shift upwards by the amount of the tax. 5. As defined by economists, the supply of corn refers to the number of bushels of corn that farmers bring to the market.