Will equilibrium in a market always result in an outcome that is economically efficient? Explain
What will be an ideal response?
An economically efficient outcome means that at the equilibrium price the marginal benefit of the last unit of output sold is equal to its marginal cost. This will occur only in markets that are competitive (many buyers and many sellers) and there are no price controls.
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An export subsidy differs from a tariff in each of the following ways EXCEPT
A) a tariff generates revenue. B) a tariff is applied to imports. C) a tariff results in an efficiency loss. D) a tariff is a tax. E) a tariff discourages imports.
In a two-person repeated game, a tit-for-tat strategy starts with
a. cooperation and then each player mimics the other player's last move. b. cooperation and then each player is unresponsive to the strategic moves of the other player. c. noncooperation and then each player pursues his or her own self-interest. d. noncooperation and then each player cooperates when the other player demonstrates a desire for the cooperative solution.
Which statement is true?
A. The United States' economy is larger than Japan's and the United States' population is larger than Japan's. B. The United States' economy is smaller than Japan's and The United States' population is smaller than Japan's. C. The United States' economy is larger than Japan's and The United States' population is smaller than Japan's. D. The United States' economy is smaller than Japan's and The United States' population is larger than Japan's.
If a firm can change market prices by altering its output then it:
a) Faces a horizontal demand curve. b) Has market power. c) Is a competitive firm. d) Is a price taker.