Under laissez faire, society's decisions about how much of every product to produce depend on
a. consumer preferences only.
b. production costs only.
c. consumer preferences and production costs.
d. neither consumer preferences nor production costs.
c
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Refer to the table above. What is the average variable cost of producing 86 units of the good?
A) $30 B) $0.35 C) $2.1 D) $10
Consider the same monopoly situation as in the previous question. The deadweight loss (compared to a single firm behaving as if it were perfectly competitive) is about
a. 667 b. 333 c. 1,000 d. 1,333
An excise tax on gasoline is regressive if
a. rich people buy more gasoline than poor people. b. the demand for gasoline is elastic. c. the tax causes people to buy less gasoline. d. poor people spend a larger portion of their incomes on gasoline than rich people.
If an oligopolist cuts the prices of its products,
A. customers will switch to a rival firm. B. customers will remain unchanged in number. C. customers will switch from rival firms to buy from them. D. rival firms will not react.