Ten friends who love to ski decide to pool their financial resources and equally share the cost of a one-week time-share condominium in Alta, Utah. Suppose that the lift lines at the ski resort become more congested when the ten additional people start to ski. Which of the following statements is not correct?
a. Use of the ski resort by the ten new skiers will yield a negative externality.
b. The ski resort can reduce the congestion externality by raising lift ticket prices.
c. An increase in lift ticket prices could be viewed as a corrective tax on the externality of congestion.
d. Each of the ten friends would have been better off staying at home.
d
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When Kate and Sam use dollars to compare the market values of their automobiles, money is acting as a
A) unit of accounting. B) standard of deferred payment. C) store of value. D) medium of exchange.
In the Keynesian aggregate expenditure model, the 45-degree line indicates:
a. amounts households plan to spend at each possible level of income. b. amounts households plan to save at each possible level of income. c. all income levels at which the planned spending of decision makers equals total output. d. all income levels at which the marginal propensity to consume is one.
When the government uses taxes and spending to affect national economy, it is engaging in:
a. fiscal policy. b. monetary policy. c. interest rate policy. d. trade policy. e. exchange rate policy.
Say a monopolist sells in two separate markets, with demand PA = 100 - 2Q and PB = 50 - Q respectively. Marginal costs in both markets are constant and equal to 8. The monopolist would charge a price of ________ in market B in order to maximize profits.
A. 8 B. 0 C. 29 D. 21