The payment for the use of a resource in an amount higher than the resource's opportunity cost is
A. an irrational economic concept.
B. economic rent.
C. reinvestment.
D. a proprietorship.
Answer: B
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In the above figure, if the market produces the efficient amount of purses then producer surplus equals triangle
A) abc. B) bcd. C) adc. D) dce.
If View Your World, a high-end window manufacturer, has contracted with local carpenters to install their windows in residential homes, this is an example of ________.
A) a market transaction B) forward integration C) outsourcing D) backward integration
A monopolistically competitive firm's marginal revenue curve:
A. is downsloping and coincides with the demand curve. B. coincides with the demand curve and is parallel to the horizontal axis. C. is downsloping and lies below the demand curve. D. does not exist because the firm is a "price maker."
Government intervention will not be necessary when voluntary contracting internalizes an externality. Which of the following is NOT a necessary condition for this to occur?
A. low transaction costs B. low contract enforcement costs C. large numbers of individuals involved in the transactions D. well-defined private property rights