Choose the letter of the diagram in Figure 3.1 that best describes the type of shift that would occur in each situation for the market listed on the left, ceteris paribus. Figure 3.1 Shifts of Supply and Demand Designer clothes: consumer confidence in the economy improves.
A. A.
B. B.
C. C.
D. D.
Answer: D
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Bobby consumes only chocolate ice cream and vanilla ice cream. He is spending all of his income
His marginal utility of chocolate is 200 and his marginal utility of vanilla is 200, and the price of chocolate is $1.00 per scoop and the price of vanilla is $2.00 per scoop. To maximize his utility, Bobby should A) buy more chocolate ice cream and less vanilla ice cream. B) buy more vanilla ice cream and less chocolate ice cream. C) not change his purchases between chocolate ice cream and vanilla ice cream. D) buy no vanilla ice cream.
Refer to the table below. If Sweet Grams is a perfectly competitive firm and the market price $1.25 per unit, what is the profit-maximizing quantity for Sweet Grams to produce at Plant 1?
Sweet Grams makes graham cracker snack packages. Sweet Grams is a multi-plant firm with two production facilities. The above table summarizes the total marginal cost of production at various output levels in the separate plants. Assume Sweet Grams is a perfectly competitive firm.
A) 27,000
B) 30,100
C) 36,000
D) 24,500
Economic profits are equal to
A) total revenues minus total fixed costs. B) total revenues, after tax, minus cost of goods sold. C) total revenues minus the implicit and explicit costs of all inputs used. D) total revenues minus the opportunity cost of labor.
Which of the following is true if all the national debt were owned internally?
a. The federal government would not need to refinance the national debt. b. The federal government would not need to worry about raising taxes to pay interest on the national debt. c. We would still be concerned about the effect on the distribution of income from interest payments on the national debt. d. All of these are true.