A consumer who buys any amount of a good will realize a positive consumer’s surplus from that good.
Answer the following statement true (T) or false (F)
False
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Market-based policies are effective methods that the government can use to address externality problems.
Answer the following statement true (T) or false (F)
Advertising by the monopolist
A. is not done because the monopolist has the only supply of the product and doesn’t need to advertise. B. would have the effect of shifting its demand curve to the left. C. may lead to expanded production by the monopolist. D. makes no sense because there are no substitute commodities available to consumers.
Refer to Table 5.1, which shows Madeline's preference ranking for various consumption bundles of bread and soup, where 1 represents her first choice, 2 her second, and so on. If the price of soup is $3 per bowl, the price of bread is $3 per loaf and Madeline's income is $9 per day, which combination of bread and soup will she choose?
A. 2 loaves of bread and 1 bowl of soup
B. 1 loaf of bread and 2 bowls of soup
C. 3 loaves of bread and 0 bowls of soup
D. 0 loaves of bread and 3 bowls of soup
Suppose John earns $10,000 and James earns $200,000. Which of the following statements is false concerning their Social Security taxes?
A. Both will pay a Social Security tax. B. John will pay Social Security tax on all of his income. C. James will pay Social Security tax on the majority of her income. D. James will pay Social Security tax at a higher average rate than will John.