Markets for illegal goods
What will be an ideal response?
- Cost of trading increases
- Larger penalties and better policing = higher costs
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In 2000, you could buy a Cadillac DTS for $45,000. In 2011, the Cadillac DTS sold for $55,000
While both models include anti-lock brakes and air bags (along with other similar features), the 2011 model also includes satellite radio and new technology that provides improved gas mileage and safer driving. If the Cadillac DTS was included in the CPI basket, it would create A) a downward bias in the inflation rate. B) an upward bias in the CPI as a result of quality change bias. C) an upward bias in the CPI as a result of commodity substitution bias. D) a downward bias in the CPI as a result of new goods bias.
When the exchange rate for the Mexican peso changes from 10 pesos to the U.S dollar to 9 pesos to the U.S. dollar, then the Mexican peso has ________ and the U.S. dollar has ________
A) appreciated; appreciated B) depreciated; appreciated C) appreciated; depreciated D) depreciated; depreciated
If the inverse demand curve a monopoly faces is p = 100 - 2Q, and MC is constant at 16, then maximum profit
A) equals $336. B) equals $882. C) equals $1,218. D) cannot be determined solely from the information provided.
Which buyers and sellers are included in the market under consideration depends on:
A. their physical proximity. B. the context. C. their preferences. D. the income levels.