The division of the burden of a tax between buyers and sellers in a market is called tax incidence
Indicate whether the statement is true or false
TRUE
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Airlines often engage in last-minute price cutting to fill remaining empty seats on a flight because this practice will generally
A) discourage rivals from matching price cuts. B) maximize marginal revenue. C) prevent rival airlines from competing in that market. D) increase marginal revenue more than marginal cost.
A negative externality exists when
A. marginal social costs are less than marginal private costs. B. marginal social costs are greater than marginal private costs. C. marginal social benefits are less than marginal private benefits. D. marginal social benefits are greater than marginal private benefits. E. b and c
In a competitive market, if buyers did not know all the prices charged by the many firms
A) all firms still face horizontal demand curves. B) firms sell a differentiated product. C) demand curves can be downward sloping for some or all firms. D) the number of firms will most likely decrease.
A labor market is divided into two segments. All workers have the same qualifications and find jobs in either segment equally attractive. Initially, both segments are in competitive equilibrium. Then the development of worker prejudice that reduces the hiring of minorities in one segment can lead to a
a. permanent increase in labor supply in the discriminating segment b. permanent increase in labor supply in the nondiscriminating sector c. temporary change in the composition of labor in both segments which will revert back to an equal distribution of workers eventually d. temporary increase in labor supply in both segments e. temporary change in wage rates in both segments