Refer to the following table to answer the question. Which of the following statements is true?Price of AQuantity Demanded of AQuantity Demanded of BQuantity Demanded of C$1.00801005$1.50609810$2.00409615$2.50209420$3.0009225
A. A and B are complements whereas A and C are substitutes.
B. A and C are complements whereas A and B are substitutes.
C. A and B are complements and A and C are complements.
D. A and B are substitutes and A and C are substitutes.
Answer: A
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More people started building houses in earthquake-prone regions when the government of Polonia launched an insurance program for houses in this region. This is an example of ________
A) adverse selection B) a positive externality C) moral hazard D) herd behavior
Think about each of the items in the list and explain how they affect incen-tives and might change the choices that people make:
What will be an ideal response?
Charitable activity _____
a. is a Pareto superior move b. is a Pareto optimal move c. is unnecessary given today's redistribution policies d. is unaffected by free riding
The figure below shows the national market for mopeds in a small country. Dd and Sd are the domestic demand and supply curves of mopeds, respectively. Initially, the country's government has a tariff on imports of mopeds. 
The figure below shows the marginal external benefit curve (MEB) of the country from the production of domestic mopeds.
What will be the impact on the national well-being if, instead of imposing a tariff of $50 per unit, the government provides a subsidy of $50 per unit to the domestic manufacturers
of mopeds? A. The national welfare will decline by $5 million. B. The national welfare will decline by $2.5 million. C. The national welfare will increase by $10.75 million. D. The national welfare will increase by $5 million.