Given the market data for good X in the above table, an equilibrium quantity is established at
A. 30 units.
B. 90 units.
C. 60 units.
D. 120 units.
Answer: C
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The government of Healthyland imposes a tax on sellers of salt. The tax is $0.10 per pound. With no tax, the market price of salt is $0.40 per pound. The demand for salt is perfectly inelastic, and the elasticity of supply is 1.5
With the tax, the price that sellers of salt in Healthyland receive and keep is A) $0.40 per pound. B) $0.35 per pound. C) $0.45 per pound. D) $0.50 per pound.
If a negative externality exists, then there is a __________ when society produces the market output instead of the socially optimal output. This exists because the __________ to sellers and third parties are __________ the __________ derived by buyers.
A. net social benefit; costs; greater than; benefits B. net social cost; benefits; less than; costs C. net social cost; costs; greater than; benefits D. net social cost; costs; less than; benefits E. none of the above
Happy Feet wants to prevent Best Nails from entering the nail salon market. If Happy Feet expands its capacity, the expansion can lead to all of the following except which one?
A) increase Happy Feet's profit-maximizing quantity B) decrease Happy Feet's profit-maximizing price C) increase Happy Feet's marginal cost D) decrease Best Nails' profit from entering the market
"John buys more of good X as his income increases, ceteris paribus," means
a. there is no cause-and-effect relationship between John's income and the quantity of good X he purchases if ceteris paribus applies b. John's demand for good X depends exclusively on income c. John's income and purchases of this good are being held constant d. the change in John's income is the only factor being considered in explaining the change in his purchase of good X e. the price of this good must have decreased in order for John to buy more of the good, regardless of changes in his income