Changes in the rate charged by electric power companies are subject to government control because
A. the electric power companies are government enterprises.
B. consumer ignorance makes it impossible to know what rates are fair.
C. the electric power companies are firms that exhibit economies of scale.
D. cutthroat competition would probably occur if the government did not intervene.
Answer: C
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Continuing from the question above, an additional 10 people join the group who have expected medical spending of $5,000 per person on average. The new premium will be approximately
a. $1,500 b. $2,200 c. $2,500 d. $4,500
In the backward-bending portion of a labor supply curve: a. a worker will increase the quantity of labor supplied in response to an increase in the wage. b. the substitution effect of a wage change outweighs the income effect
c. the income effect of a wage change outweighs the substitution effect. d. the substitution effect of a wage change equals the income effect.
We assume an upward sloping supply curve because:
A. the income effect tends to dominate labor-supply decisions in the real world. B. it makes better theoretical sense that the income effect would dominate. C. the price effect tends to dominate labor-supply decisions in the real world. D. it makes better theoretical sense that the price effect would dominate.
The alternative to voluntary exchange is self-sufficiency.
Answer the following statement true (T) or false (F)