The problem of asymmetric information that brings about a general decline in product quality in an industry is
A) a market failure.
B) the result of government regulation.
C) creative response.
D) the lemons problem.
D
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The maximum amount Jameson would be willing to pay for a cupcake, less the price he actually pays, is called
A) consumer surplus. B) producer surplus. C) cooperative surplus. D) deadweight loss.
The idea of the "invisible hand" tells us that individuals will pursue:
A. mutually beneficial trades with other individuals to maximize surplus. B. trades in which they will be the clear winner and the other will be a loser. C. the most equitable outcome possible. D. as few government policies as possible so the market can act freely.
A perfectly price discriminating monopolist's profit is ________ the profit of a monopolist who charges the same price to all of its customers.
A. the same as B. higher than C. sometimes less than and sometimes greater than. D. less than
Marginal utility is equal to
A. total utility multiplied by quantity consumed. B. change in total utility multiplied by change in quantity consumed. C. change in total utility divided by change in quantity consumed. D. total utility divided by quantity consumed.