For a previously-illegal good, decriminalization will cause
A. demand to become less elastic.
B. supply to increase.
C. supply to become less elastic.
D. price to fall, unambiguously.
Answer: B
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Which of the following statements is true of the market for labor?
A) In the market for labor, the supply curve is always more inelastic than the demand curve. B) In the market for labor, there is a shortage of labor at the point of intersection of the labor demand and labor supply curves. C) In the market for labor, there is a surplus of labor at the point of intersection of the labor demand and labor supply curves. D) In the market for labor, both the equilibrium wage rate and quantity of labor are determined at the point of intersection of the labor demand and labor supply curves.
When comparing the U.S. and Mexican car assembly industries, the disadvantage of higher U.S. wages is offset by
A) Mexican trade barriers. B) trade adjustment assistance in the United States. C) higher productivity in the United States. D) a lower opportunity cost in Mexico. E) "Buy American" advertising campaigns in the United States.
To test whether or not the population regression function is linear rather than a polynomial of order r,
A) check whether the regression R2 for the polynomial regression is higher than that of the linear regression. B) compare the TSS from both regressions. C) look at the pattern of the coefficients: if they change from positive to negative to positive, etc., then the polynomial regression should be used. D) use the test of (r-1) restrictions using the F-statistic.
In the real world:
A. businesses can easily identify different groups' willingness to pay, so price discrimination is prevalent in every market. B. price discrimination is practiced less today than it was in the mid-1900s. C. perfect price discrimination is impossible. D. price discrimination has only been observed where monopolies are present.