What problems are implicit in the concept of utility?
What will be an ideal response?
(1.) It is impossible to measure utility.
(2.) It is impossible to compare the utility of different people.
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Refer to Game Matrix II. Assume this game is played sequentially. When is the Stackelberg equilibrium of this game also Pareto optimal?
Game Matrix II
The following questions refer to the game matrix below. Player A can play the strategies "High" and "Low," and Player B can play the strategies "Odd" and "Even."
a. Always.
b. When A is the first player.
c. When B is the first player.
d. Never.
A problem encountered when implementing an "infant industry" tariff is that
A) domestic consumers will purchase the foreign good regardless of the tariff. B) the industry may never "mature." C) most industries require tariff protection when they are mature. D) the tariff may hurt the industry's domestic sales. E) the tariffs fail to protect the domestic producers.
The Earned Income Tax Credit replaced many government transfer programs
a. True b. False
A common example of indexing in the United States is: a. annual bonuses to workers
b. wage increases with seniority. c. 30-year fixed-rate mortgage loans. d. escalator clauses tied to the CPI in wage agreements.