We observe that the price per ounce of milk in a quart container is higher than the price per ounce in a gallon container. What is the likely reason for this?
A. The higher costs of quart containers
B. The higher costs of production of milk in smaller quantities.
C. Higher transportation costs for smaller container sizes.
D. The marginal utility of milk is higher in smaller containers than it is in larger containers.
Answer: D
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If immigration increases the productivity of domestic workers, then it:
A. Decreases the return on capital B. Means that immigrant workers and domestic workers are substitutes C. Means that immigrant workers are entering low-wage occupations D. Increases the return on capital
If the cross-price elasticity of demand for goods A and B is zero, this means the two goods are unrelated
Indicate whether the statement is true or false
Suppose a particular production process results in a large amount of pollution and the government decides to impose a tax to correct for this externality, such that the socially optimal output will be produced. The tax will have the effect of shifting the
A. marginal private benefit curve to the right. B. marginal social benefit curve to the right. C. marginal private cost curve to the left. D. marginal social cost curve to the left. E. marginal private cost curve to the right.
In both a monopolistically competitive market and a pure monopoly market, firms
A. can make long-run profits. B. advertise extensively. C. set price greater than marginal cost. D. are protected by entry barriers.