Erin and Deidre, two residents of Ithaca, New York, are planning a trip to Boston. Erin, the sales manager for a large retailer, has to attend a business meeting
Deidre, a college student on vacation, is planning a leisurely trip to visit friends and relatives. Which of the following statements is true?
A) Since there is no difference in the cost of producing air travel, airlines will not charge different prices to Erin and Deidre.
B) An airline cannot price discriminate because buyers can resell their tickets through the Internet.
C) An airline that price discriminates will charge Erin a higher price.
D) An airline that price discriminates will charge Deidre a higher price.
C
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The experience of sub-Saharan Africa, as compared to that of "Other Asia" (not including the HPAEs) supports the argument that
A) high rates of protection tend to harm economic growth. B) the poorer is the country the easier it is for it to "catch up" economically. C) low rates of protection tend to promote economic growth. D) free trade always best stimulates a developing country's economy. E) neither trade liberalization nor import substitution is a foolproof strategy for economic development.
In a market where a positive externality is present, the effect of a government subsidy would be to ensure:
A. an efficient outcome. B. that those who enjoy the benefit receive the surplus. C. a more fair distribution of surplus. D. All of these statements are true.
The narrowest definition of money is:
A. M1. B. M2. C. hard money. D. L.
Explain how a firm's cost curves and optimal rate of output are affected by (a) property taxes; (b) payroll taxes; and (c) taxes on profits.
What will be an ideal response?