According to the indifference principle, housing prices
a. tend to converge over time
b. tend to leave individuals indifferent about where they live
c. only tend to be different to compensate individuals for differences in living conditions
d. only B&C
d
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Briefly and concisely define the following terms:
a. statistical discrimination b. compensating wage differential c. affirmative action
What factors determine the vertical shape of the aggregate supply curve in the long-run? Explain.
What will be an ideal response?
A firm is currently producing in the elastic portion of its demand curve. What course of action do you recommend for it assuming it wants to raise revenue?
A. Continue selling at the same price, but increase the amount it produces. B. Increase price, because if it increases price and demand is elastic, total revenue will increase. C. Continue producing at the current output level, because it maximizes its total revenue by producing in the elastic portion of its demand curve. D. Reduce price, because if it reduces price and demand is elastic, total revenue will increase.
Refer to Scenario 16.1 below to answer the question(s) that follow. SCENARIO 16.1: The marginal benefit for a particular food is described by MB = 30 - q, where q refers to the quantity of the food. The marginal cost of producing the food is described by MC = 2q. There is a negative externality associated with food production and the marginal social cost of food production is MSC = 4q.Refer to Scenario 16.1. The competitive output level is ________ and the competitive price is ________.
A. 10 units of food; $20 B. 4.29 units of food; $25.71 C. 6 units of food; $24 D. 0 units of food; $0