Suppose all people have the same age-earnings profile and the percent of the population in each age category is the same. The distribution of income at any point in time will be
A. equal because incomes and wealth levels must then be the same.
B. unequal because incomes differ by age.
C. equal because all have the same profile.
D. unequal because other sources of income will differ.
Answer: B
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There is a technological advance in the production of ice cream. As a result, the supply curve of ice cream shifts ________ and ________
A) leftward; both the equilibrium price and equilibrium quantity fall B) rightward; both the equilibrium price and equilibrium quantity fall C) rightward; the equilibrium price falls while the equilibrium quantity increases D) rightward; both the equilibrium price and equilibrium quantity rise
Which of the following market structures is considered imperfectly competitive?
A. Perfect competition B. Monopolistic competition C. Monopoly D. All of these are considered imperfectly competitive.
One way to achieve efficiency in a market with a negative externality is
a. to raise the market demand curve to the position of the marginal social cost curve b. to apply the Coase theorem c. to lower the marginal social cost curve to the position of the market supply curve d. to eliminate all side payments e. to raise the market supply curve to the position of the marginal social cost curve
Which of the following examples indicates that two oligopolistic firms are involved in a non-cooperative game?
a. The two firms collude to improve their profit-maximizing position. b. The two firms forge a binding contract to align their pricing strategies. c. Each firm sets its own prices without consulting its competitor. d. Each firm talks to its competitor before setting its prices.