The Redwood City Council has decided that there is an overallocation of resources in the lawn-care industry. Almost every homeowner owns a lawnmower, hose and sprinkler, seeder, spreader, etc., and these items are used, at most, once a week. The council
will establish a legal monopoly and select a private firm that will be responsible for all lawn care in the city. What types of rent-seeking activities can be expected as a result of this action?
As firms vie for this contract, they will attempt to garner the support of the individual council members. Lobbyists and attorneys might be hired and other resources expended by firms seeking the contract. In the end, only one firm will "win" the contract, and the lobbying efforts of the other firms will have been in vain and an unproductive use of the resources.
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Along a straight line, the value of y is always equal to the value of x. The slope of the line is
A) -1. B) 0. C) 1. D) infinite.
Refer to Table 4-12. The equations above describe the demand and supply for Bubba's Fried Jellybeans. The equilibrium price and quantity for Bubba's Fried Jellybeans are $40 and 5 thousand units. What is the value of consumer surplus?
A) $5 thousand B) $12.5 thousand C) $25 thousand D) $37.5 thousand
The key explanation for the prevalence of waterway pollution is
A. the inclusion in production of all costs involving use of the waterway. B. that there are private costs but no costs to society. C. that waterways are not private property and can be used free of charge. D. that waterways are subject to the market’s normal control procedures.
A monopolist's profit maximizing price is $15 . At MC=MR, the output is 100 units and the MC is $10 . At this level of production, average total costs are $12 . Monopolist's profits are
a. $300 b. $1500 c. $500 d. None of the above