If a consumer wishes to maximize satisfaction given limited income and MUx/Px< MUy/Py then the consumer should:
A. buy less of both X and Y.
B. buy more of X and less of Y.
C. buy more of Y and less of X.
D. buy more of both X and Y.
Answer: C
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The above figure shows the market for buckets of golf balls at the driving range. A new leisure time tax is placed on suppliers in this market, shifting the supply curve from S0 to S1
The quantity of buckets without the tax is ________ and the quantity with the tax is ________. A) 400; 600 B) 600; 400 C) 400; 400 D) 800; 500 E) 600; 500
Suppose the demand for meals at a medium-priced restaurant is elastic. If the management of the restaurant is considering raising prices, it can expect a relatively:
A) large decrease in quantity demanded. B) large decrease in demand. C) small decrease in quantity demanded. D) small decrease in demand.
Land owners with secure and protected property rights are motivated to
(a) use their land productively. (b) maintain their land and its value as long as the land is owned privately and profits are realized by the land owners. (c) not hold their land idle if they face property taxes due to costs imposed by the tax system. (d) link land ownership and personal freedom.
Suppose the market for potatoes can be expressed as follows: Supply: QS = -20 + 10p Demand: QD = 400 - 20p Solve for the equilibrium price and quantity
What will be an ideal response?