When comparing point A, which lies within a utilities possibilities frontier, with point B, which lies on the same utilities possibilities frontier,
A) A is necessarily more efficient than B.
B) A is necessarily more equitable than B.
C) B is necessarily more efficient than A.
D) B is necessarily more equitable than A.
C
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Adam Smith used the metaphor of the "invisible hand" to explain how
A) business owners are benevolent. B) markets mismatch buyers and sellers. C) people acting on their own self-interest promote the interest of society as a whole. D) the production possibilities frontier illustrates efficient outcomes.
Tom and Jerry have two tasks to do all day: make dishes and build fences. If Tom spends all day making dishes, he will have make 16 dishes. If he instead devotes his day to building fences, Tom will build 4 fences. If Jerry spends his day making dishes, he will make 14 dishes; if he spends the day building fences, he will build 7 fences. At the end of the day, Jerry could have produced:
A. 14 dishes and 7 fences. B. 12 dishes and 6 fences. C. 10 dishes and 5 fences. D. 6 dishes and 4 fences.
If the labor market is perfectly competitive the wage rate will be less than the marginal revenue product of labor
a. True b. False Indicate whether the statement is true or false
Given high transactions costs, the best way to deal with a positive externality is
A. to allow both parties to negotiate. B. to limit the extent of the externality. C. to subsidize it. D. to tax it.