An asset-price bubble is caused by:
A. people buying assets because they believed prices would keep going up and they'd be able to sell for a profit.
B. fads that make owning a certain asset fashionable.
C. severe inflation within a short period of time.
D. the increase in the value of durable goods when the economy is experiencing low inflation.
A. people buying assets because they believed prices would keep going up and they'd be able to sell for a profit.
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Suppose a small island nation imports sugar for its population at the world price of $1,500 per ton. The domestic market for sugar is shown below.
With no subsidy, what is producer surplus?
A. $0 per day B. $1,000 per day C. $8,000 per day D. $4,000 per day
What conditions are necessary to determine if the purely competitive firm should produce in the short run? State the marginal revenue and marginal cost conditions and the total revenue and total cost conditions
What will be an ideal response?
An increase in the price of a good causes people to buy less of it because
a. the demand for the good decreases b. they have less income to spend on the good c. the marginal utility from additional units of consumption of the good decreases d. the marginal-utility-to-price ratio for the good decreases e. consumer surplus from consumption of the good decreases
Clarifying conflicting property rights claims
What will be an ideal response?