The table above shows the marginal costs and marginal benefits of college education. The marginal social benefit of college education at the efficient amount of enrollment is
A) $20,000 per year.
B) $16,000 per year.
C) $12,000 per year.
D) $14,000 per year.
B
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The price elasticity of demand for good x is defined as:
a. percentage change in px / percentage change in x. b. percentage change in x /percentage change in px. c. percentage change in x/percentage change in income. d. percentage change in x /percentage change in py.
When the government pays for childhood vaccinations, it is
A. subsidizing an external benefit. B. using taxes to discourage an external cost. C. internalizing an external cost. D. using direct regulation to discourage an external cost.
Total revenue decreases if price ________ and demand is ________.
A. rises; inelastic B. rises; unit elastic C. falls; elastic D. falls; inelastic
When a monopolist decreases the price of its good, consumers
a. continue to buy the same amount. b. buy more. c. buy less. d. may buy more or less, depending on the price elasticity of demand.