The enforcement of contracts by the government:
A. allows people to enter into long-term investments more easily.
B. encourages economic growth.
C. can increase physical capital investment.
D. All of these are true.
Answer: D
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In the above figure, if this natural monopolist were regulated and allowed to earn a "fair" rate of return, it would produce
A) at Q1 output rate. B) at Q2 output rate. C) at Q3 output rate. D) past the Q3 output rate.
Short-run decisions are:
A. constrained because some inputs are fixed and others are variable. B. constrained because all inputs are fixed. C. unconstrained because all inputs are variable. D. constrained because all inputs are variable.
The number of seats available in a stadium is fixed at 80,000. The equilibrium price for a ticket to a football game at the stadium is $30. The equilibrium price for a ticket to a baseball game at the stadium is $20. Which of the following is true?
A. The supply of baseball games must be less elastic than the supply of football games. B. The demand for each baseball game must be lower than the demand for each football game. C. Football games must be more expensive to produce than baseball games. D. The demand for baseball games must be more elastic than the demand for football games.
A tariff is a
A. subsidy to workers harmed by U.S. trade with foreign countries. B. limit on the quantities of a good that can be imported each year. C. tax on exports that tends to make them cheaper for foreigners to buy. D. tax on imports that raises their prices and makes them less attractive to domestic consumers.