Suppose your best friend's birthday is next week and you are willing to pay $300 for a gift of Rollerblades, but you found them on sale for $200 at Sportsmart. Lucky? Yes. Your consumer surplus is
a. $300
b. $600
c. $100
d. $200
e. $500
C
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The theory of rational expectations states that
a. expected inflation will be no different from actual inflation, on average. b. expectations are based on all possible information. c. individuals always act optimally. d. expected inflation will be lower than actual inflation.
For any given output level, a firm's long-run costs
a. are always greater than or equal to its short-run costs. b. are usually greater than or equal to its short-run costs except in the case of diminishing returns to scale. c. are always less than or equal to its short-run costs. d. are usually less than or equal to its short-run costs except in the case of diminishing returns to scale.
Unpriced by-products of production or consumption that provide benefits to other consumers or other firms are known as
a. negative externalities b. common pool benefits c. positive externalities d. private benefits e. Coase by-products
The accompanying figure shows Becky's daily production possibilities curve for dresses and skirts.
Point U is:
A. inefficient. B. efficient. C. unattainable. D. attainable.