Which question is typically asked by economic engineers?
A. Can we rely on the markets to distribute income fairly?
B. Can we assume that people always behave rationally?
C. Can we design mechanisms to improve the coordination of people's actions?
D. Can we increase the amount of mathematics in the model?
Answer: C
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When a competitive market maximizes economic surplus, it implies that the
A. quantity demanded is lower than the quantity supplied. B. marginal benefit of having the product is greater than the marginal cost. C. combined consumer and producer surplus is maximized. D. buyers are getting the maximum consumer surplus from the product.
An effective import quota is one that increases the amount of tariff revenues received
a. True b. False
Suppose the government taxes 30 percent of the first $70,000 and 50 percent of all income above $70,000 . For a person earning $200,000 . the marginal tax rate is
a. 30 percent, and the average tax rate is 50 percent. b. 30 percent, and the average tax rate is 43 percent. c. 50 percent, and the average tax rate is 40 percent. d. 50 percent, and the average tax rate is 43 percent.
Suppose that Jones builds a new house, then she sells it to Smith, and then Smith sells it to Williams. The total net investment from these transactions is:
A. zero. B. 1 house. C. 2 houses. D. 3 houses.