If Harry only pays $25,000 to purchase a new car even though he would have been willing to pay as much as $35,000 for the car, this indicates that
What will be an ideal response?
Harry reaped $10,000 of consumer surplus from the transaction.
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If a nation devotes a larger share of its current production to consumption goods, then
A) it must produce at a point within its PPF. B) its economic growth will slow down. C) some productive factors will become unemployed. D) its PPF will shift inward. E) its PPF will shift outward.
Under monopolistic competition, the number of firms increases as fixed entry costs fall and as demand for the type of good produced in the market increases.
Answer the following statement true (T) or false (F)
Milk costs $2 and the last unit provides $4 in marginal utility. Cheese costs $4 and the last unit provides $2 in marginal utility. Is this an efficient allocation of resources? If so, why? If not, why not?
What will be an ideal response?
Which of the following is an example of a positive statement?
a. If drug prices increase, the government should offer free drugs to seniors. b. If income taxes increase, the government should offer rebates. c. If the price of apples increases, stores should put them on sale. d. If the price of movie tickets increases, theatrical attendance will decrease.