New airplanes, which normally consume less fuel per passenger-mile, become less efficient for commercial airlines to purchase and use as
A) average flight distances lengthen.
B) fewer non-stop flights are scheduled.
C) fuel prices fall.
D) the demand for airline travel increases.
E) the price of new airplanes falls.
Ans: C) fuel prices fall.
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If a firm has consumers with different demands practices two-part pricing and it is profitable for the firm to sell to all consumer types, the profit-maximizing user fee will be ________ the firm's marginal cost of use.
A) greater than B) double C) less than D) equal to
Which of the following explains allocative efficiency?
a. Producing the optimal quantity of an output for a society b. Producing the minimum number of goods that a society wants c. Producing goods at the lowest possible price and quality level d. Producing at a level that lowers costs and increases quality
Externalities can be produced by ____________, as well as ____________.
A. individuals; firms B. market prices; market incomes C. oceans; streams D. none of these answer options are correct.
If the principal has full information, production efficiency without supervision can occur with
A) a fixed fee rental contract. B) a profit-sharing contract. C) an incentive-compatible contract. D) All of the above.