In order to ensure allocative efficiency on the part of a natural monopoly, regulators would set price equal to marginal cost
a. True
b. False
A
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Which of the following are motivations for those seeking redistributive transfers?
a. The creation of more income equality. b. To help out those who are less fortunate c. To create a more just economic system. d. a and b e. all of the above
At the December meeting of the American Economic Association, 2,500 new Ph.D.s look for college teaching jobs. If the average wage offer is $40,000 and Tedium University makes that offer, it is likely to
a. be ignored b. attract only average Ph.D.s c. attract applicants from top schools d. attract Ph.D.s with strong dissertations e. attract applicants of below-average quality
High income countries with larger governments as a share of GDP have generally
a. grown less rapidly than their counterparts with smaller governments. b. experienced less deadweight losses resulting from taxes and/or government borrowing. c. seen the government decrease in size as real GDP rises. d. been able to be more economically efficient.
Give an example of how a hypothetical firm can use advertising to convey the quality of its product.
What will be an ideal response?