Marcus says that he would smoke one pack of cigarettes each day regardless of the price. If he is telling the truth, Marcus's
a. demand for cigarettes is perfectly inelastic.
b. price elasticity of demand for cigarettes is infinite.
c. income elasticity of demand for cigarettes is 0.
d. More than one of the above is correct.
a
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For any given tax, imposing a tax in a market with a highly inelastic demand will:
A. cause more deadweight loss than a market with an elastic demand. B. generate higher revenues than a market with an elastic demand. C. Both of these statements are true. D. Neither of these statements is true.
Which of the following does not represent a tradeoff facing a consumer?
a. choosing to purchase more of all goods b. choosing to spend more time on leisure and less time on work c. choosing to spend more now and consume less in the future d. choosing to purchase less of one good in order to purchase more of another good
At the output level defining allocative efficiency
A. the areas of consumer and producer surplus necessarily are equal. B. consumer surplus exceeds producer surplus by the greatest amount. C. marginal benefit exceeds marginal cost by the greatest amount. D. the maximum willingness to pay for the last unit of output equals the minimum acceptable price of that unit of output.
Exports minus imports equals net exports.
a. true b. false