Refer to the following graph.
Assuming a marginal cost external to the trade equals the tax shown in the graph, the market price necessary to induce consumers to purchase the efficient quantity each year is:
A. P1.
B. P2.
C. P3.
D. P4.
Answer: B
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As more efficient capital equipment becomes available, the demand for labor will ________, the real wage will ________, and the quantity of labor hired will ________
A) increase; increase; increase B) increase; decrease; remain the same C) increase; remain the same; decrease D) increase; remain the same; increase
In a two-person repeated game, a tit-for-tat strategy is
a. When each player pursues his or her own self-interest without any cooperation b. When players start off as non-cooperative and then cooperate when one or both players show interest in colluding c. When players start off by cooperating and then mimic the other player's last move d. With neither players defecting
Social forces:
a. affect the price mechanism through cultural norms. b. affect the price mechanism through the educational system. c. affect the price mechanism through scarcity. d. do not affect the price mechanism.
Which of the following can create demand-pull inflation?
A. Excessive aggregate spending. B. Sharply rising oil prices. C. Higher labor costs. D. Recessions and depressions.