The private market:
a. tends to overproduce public goods because they are nonrivlarous
b. can produce public goods more efficiently than the government can
c. earns excessive profit on public goods
Answer: c. earns excessive profit on public goods
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Which of the following statements is true?
A) There will be no change in unemployment if there is a leftward shift in the labor demand curve and there is wage rigidity, everything else remaining unchanged. B) Unemployment will be higher if there is a leftward shift in the labor demand curve and there is no wage rigidity, everything else remaining unchanged. C) Unemployment will be higher if there is a leftward shift in the labor demand curve and there is downward wage rigidity in the labor market, everything else remaining unchanged. D) There will be an increase in unemployment if there is a leftward shift in the labor demand curve and there is no wage rigidity, everything else remaining unchanged.
If the inflation rate is 5 percent and the real interest rate is 2.5 percent, then the nominal interest rate is
A) 10 percent. B) -2.5 percent. C) 2.5 percent. D) 7.5 percent. E) 2 percent.
Joe's Imports is currently the only dealer for imported Sporto autos on the East Coast, but Fred's Autos may enter the import market and start selling Sporto cars in the East Coast market during the coming year
Joe's Imports can pay the Sporto manufacturer for exclusive East Coast marketing rights, which would deter the entry of Fred's Autos into the market. The payoffs from the possible actions are measured in millions of dollars per year, and the possible outcomes of the sequential entry game are summarized in the following matrix: Fred's Autos enters Fred's Autos does not enter Joe's Imports buys rights ---- 50, 0 Joe's Imports does not buy 40, 40 80, 0 What is the equilibrium outcome from this sequential entry game? A) Joe's Imports buys the marketing rights, and Fred's Autos cannot enter the market. B) Joe's Imports buys the marketing rights, and Fred's Autos enters the market. C) Joe's Imports does not buy the marketing rights, and Fred's Autos enters the market. D) Joe's Imports does not buy the marketing rights, but Fred's Autos does not enter the market.
If the price of wireless earbuds increases, then there will be ________ of wireless earbuds.
A. a decrease in the supply B. an increase in the supply C. a decrease in the quantity supplied D. an increase in the quantity supplied