For which situation would we expect the adjustment speed to be the fastest?
A. The demand for surgeons increases.
B. A large increase in birth rates leads to an increase in elementary school teachers.
C. The demand for office space in downtown Chicago increases.
D. The demand for movie videos increases.
Answer: D
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Figure 16.1A firm that generates pollution is illustrated in Figure 16.1. If the government imposes a pollution tax equal to P3, the firm's abatement choice will be:
A. A1. B. A2. C. A3. D. less than A1.
Utility is:
A. useful in quantitatively describing a person's preferences for one good over another. B. useful in comparing the relative satisfaction different consumers get from a particular good. C. an interesting concept, but not really useful for anything. D. useful in predicting when to put an item on sale.
Normal profits are:
A. The profits reported by accountants on a firm's annual financial statement B. Identical to economic profits C. Determined by subtracting total costs from total revenues D. Considered an implicit cost by economists
If the annual interest rate is 10%, the net present value of receiving $550 in the next year is:
a. $550 b. $551 c. $549 d. $500