Government intervention always results in the optimal mix of output.
Indicate whether the statement is true or false.
Ans: False
Government intervention sometimes results in worsening the situation, rather than improve the situation.
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Which of the following is true regarding income along a price-consumption curve?
A) Income is increasing. B) Income is decreasing. C) Income is constant. D) The level of income depends on the level of utility.
Suppose Jack and Kate are at the town fair and are choosing which game to play. The first game has a bag with four marbles in it-1 red marble and 3 blue ones. The player draws one marble from the bag; if it is red, they win $20 and if it is blue, they win $1. The second game has a bag with 10 marbles in it-1 red, 4 blue, and 5 green. The player draws one marble from the bag; if it is red, they win $20; if it is blue, they win $5; and if it is green, they win $1. Both games cost $5 to play. What is the probability of drawing a red marble in each game?
A. 10 percent in the first game and 25 percent in the second game B. 25 percent in both games C. 25 percent in the first game and 10 percent in the second game D. 10 percent in both games
Karl Marx believed that the entrepreneur derived his profit from __________________.
Fill in the blank(s) with the appropriate word(s).
Consider two firms competing to sell a homogeneous product by setting price. The inverse demand curve is given by P = 20 ? Q. Firm 1 has MC1(Q1) = 2 and firm 2 has MC2(Q2) = 2.25. Based on this information, we can conclude that the market price will be:
A. $2 and each firm will produce 9 units. B. $2.25 and each firm will produce 8.875 units. C. $2 and firm 1 will produce 18 units and firm 2 will produce 0 units. D. $2.24 and firm 1 will produce 17.76 units and firm 2 will produce 0 units.