Assume that Abby, Ben, Clara, Joe, and Matt are the only citizens in a community. A proposed public good has a total cost of $1,000. All five citizens will share an equal portion of this cost in taxes. The benefit of the public good is $220 to Abby, $210 to Ben, $210 to Clara, $180 to Joe, and $120 to Matt. In a majority vote, this proposal will most likely be
What will be an ideal response?
accepted, three in favor and two against.
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Government purchases of goods and services are
A. exhaustive because they directly absorb or employ resources and account for production. B. neither exhaustive or nonexhaustive because of the tax revenues that finance these purchases. C. nonexhaustive because they do not directly absorb resources and account for production. D. both exhaustive and nonexhaustive because in some cases they do directly absorb resources or account for production and in other cases they do not.
Consider the perfectly competitive firm in the above figure. At what price will long-run equilibrium occur?
A) $11 B) $12 C) $22 D) $23
The price elasticity of demand coefficient for a good will be greater:
a. if close substitutes exist. b. if minor complements exist. c. in the short-run. d. if a small portion of the budget will be spent on it.
A risk-averse person
a. has a utility curve where the slope increases with wealth, and might take a bet with a 80 percent chance of winning $300 and a 20 per chance of losing $300. b. has a utility curve where the slope increases with wealth, and would never take a bet with a 80 percent chance of winning $300 and a 20 per cent chance of losing $300. c. has a utility curve where the slope decreases with wealth, and might take a bet with a 80 percent chance of winning $300 and a 20 per chance of losing $300. d. has a utility curve where the slope decreases with wealth, and would never take a bet with a 80 percent chance of winning $300 and a 20 per cent chance of losing $300.