Which of the following is true of the demand curve for a normal good?
a. The shape of the individual demand curve for a normal good is necessarily linear
b. The slope of the individual demand curve for a normal good is necessarily positive.
c. The shape of the individual demand curve for a normal good can either be linear or non-linear.
d. The slope of the individual demand curve for a normal good can either be positive or negative.
c
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Which of the following is not an example of rent seeking?
A. A firm uses resources to convince a legislature to direct subsidies toward the firm. B. A mastermind hires a crew to tunnel into a bank vault. C. A person listens to an outdoor concert without paying. D. A window salesman throws bricks through perfectly fine windows.
The government raises gasoline taxes as part of the price of gasoline and receives more tax revenues. However, after five years, the government discovers that revenues from the gasoline tax have declined. This situation would be most likely to occur if
A) the long-run elasticity of supply was much greater than the long-run elasticity of demand. B) the demand for gasoline was inelastic in the short run, but elastic in the long run. C) the long-run elasticity of demand was greater than the long-run elasticity of supply. D) the demand for gasoline was perfectly inelastic in both the short run and the long run.
Answer the following questions true (T) or false (F)
1. A decrease in liabilities will reduce a firm's accounting profit. 2. Economic profit is the difference between a firm's revenue and its opportunity costs. 3. An increase in liabilities will reduce a firm's net worth.
As you move up the production possibility frontier, the absolute value of the marginal rate of transformation
A. initially decreases, then increases. B. increases. C. initially increases, then decreases. D. decreases.