In the market for used cars, the lemons model predicts that:
A. sellers are less likely to sell low-quality cars than high-quality cars.
B. sellers are more likely to sell low-quality cars than high-quality cars.
C. sellers are more likely to understate the condition of their cars.
D. buyers are more likely to overstate their reservation price.
Answer: B
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Legislators are indifferent about placing a unit tax on the suppliers of a good or the demanders. If a tax is placed on the suppliers of the good _____
a. suppliers will pay the entire tax b. suppliers will pay more than if the tax were initially placed on the demanders c. suppliers will pay exactly what they would pay if the tax were initially placed on the demanders d. suppliers will pay less than if the tax were initially placed on the demanders
Refer to the table below. If Stuffed Pies is currently producing 5 units of quality, to maximize profit, Stuffed Pies should ________ the units of quality.
Stuffed Pies is a frozen calzone manufacturer. The table above summarizes Stuffed Pies' marginal revenue and marginal cost of quality at various quality amounts.
A) decrease
B) not change
C) increase
D) decrease by 50 percent
If 2017 is the base year, what is the price index for a market basket of goods for 2018 in the above table?
A. 97.3 B. 128.0 C. 102.8 D. Zero, since the price of CDs fell and the price of gasoline increased
Which of the following is a correct statement?
A) Inflation is measured as the percentage change in the CPI. B) The CPI is a widely used measure of the inflation rate. C) Real GDP is our best measure of economic growth. D) The PPI measures inflation as experienced by producers.