The real price of a product is its
A. absolute level on any given day divided by the relevant price index.
B. absolute level on any given day.
C. absolute level on any given day minus any external costs of the production of the good.
D. price relative to the price of other goods and services.
Answer: D
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What is the largest problem associated with using a tax to correct for an externality? Explain
What will be an ideal response?
Unlike the revolutionary colonials, England had
(a) an organized army and navy. (b) an abundance of resources. (c) the means to finance the war. (d) all of the above.
A typical professional National Football League team has three quarterbacks on its roster. What is one reason why they might not have a fourth quarterback?
A) The fourth quarterback's marginal product is approximately zero. B) The fourth quarterback's marginal product is approximately ten. C) The fourth quarterback's marginal product is less than the first quarterback's marginal product. D) There is a law against carrying four quarterbacks on a team.
The law of diminishing product states that if increasing quantities of a variable factor are applied to a given quantity of fixed factors, then:
a) the MP and the AP of the variable factor will eventually decrease. b) TP will eventually begin to fall. c) the AP will eventually decrease, but only if TP is held constant. d) the MP will eventually decrease with constant AP. e) the AP will eventually decrease with constant MP.