Which of the following statements is true?
A. There are more attainable points than unattainable points in every PPF diagram.
B. If scarcity did not exist, neither would a PPF.
C. All PPFs are downward-sloping straight lines
D. The concept of opportunity costs cannot be illustrated within a PPF framework.
B. If scarcity did not exist, neither would a PPF.
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Suppose a 4 percent increase in price results in a 2 percent increase in the quantity supplied of a good. Calculate the price elasticity of supply and characterize the product
A) 2; The product is elastic. B) 0.5; The product is inelastic. C) 0.2; The product is inelastic. D) 50%; The product is inelastic.
Suppose fairness is defined as those with the highest incomes can afford to pay a greater proportion of their income in taxes. Then which of the following taxation systems would be consistent with this notion of fairness?
a. A true flax tax. b. A flat sales tax on consumption purchases. c. A progressive tax on income. d. A fixed federal tax of $5,000 that everyone pays regardless of income status.
There is a shortage when price is _____ the equilibrium level.
Fill in the blank(s) with the appropriate word(s).
The long-run equilibrium of a monopolistic competitor differs from the long-run equilibrium of a perfect competitor in that
A) the monopolistic competitor makes economic profits. B) the monopolistic competitor sets price equal to marginal cost. C) the monopolistic competitor produces at the minimum point of its average total cost curve. D) the monopolistic competitor charges a price that exceeds marginal cost.