In the above table, the production of 3 pizzas and 35 cases of soda is
A) impossible unless more resources become available.
B) feasible but would involve unemployed or misallocated resources.
C) possible only if the economy produces with maximum efficiency.
D) possible only if there is inflation.
B
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Whether or not a separating equilibrium exists in a competitive market with adverse selection depends on what fraction of consumers is of the high cost type and what fraction is of the low cost type.
Answer the following statement true (T) or false (F)
Free markets produce too little output when
a. negative externalities exist b. positive externalities exist c. production uses fixed-production technology d. production uses variable technology e. the resource is exhaustible
Assume that between 1998 and 2008, nominal GDP increased from $7 trillion to $12 trillion and that the price index rose from 100 to 133.3 . Which of the following expresses GDP for 2008 in terms of 1998 prices?
a. $7.5 trillion b. $9.0 trillion c. $9.5 trillion d. $16.0 trillion
Fran runs a doughnut shop in a tiny 3-person town. The accompanying table shows the quantity demand by the three townspeople at various prices. Price Per DoughnutQuantity Demandedby AlQuantity Demandedby BettyQuantity Demandedby Carol10 cents104625 cents92535 cents71550 cents504When the price of a doughnut is 25 cents, what is the market demand for doughnuts?
A. 9 doughnuts B. 16 doughnuts C. 20 doughnuts D. 13 doughnuts