Suppose that the average football player earns $1 million per year and that there are 500 players. The average school teacher earns $25,000 per year and there are 1 million teachers. From this we can say that
a. football players are paid too much.
b. teachers are paid too little.
c. the group of football players must be more valuable than teachers as a group.
d. teachers as a group are more valuable than the group of football players.
d. teachers as a group are more valuable than the group of football players.
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Why is society's marginal social benefit curve for a public good found by vertically summing individual marginal benefit curves and not by horizontal summation as is the case for private goods?
What will be an ideal response?
Refer to Figure 13-1. Ceteris paribus, an increase in the growth rate of domestic GDP relative to the growth rate of foreign GDP would be represented by a movement from
A) AD1 to AD2. B) AD2 to AD1. C) point A to point B. D) point B to point A.
Suppose a perfectly competitive firm, which is initially in long-run equilibrium experiences a decrease in the wages it must pay its employees. In the short run, which of the following will occur?
A) ATC will shift up and MC will shift down, causing the firm to incur a loss. B) ATC will shift down and MC will shift up, causing the firm to earn a positive economic profit. C) ATC and MC will shift down, causing the firm to earn a positive economic profit. D) ATC and MC will shift up, causing the firm to incur a loss.
The payments to owners of capital include
a. interest and profits. b. debt and taxes. c. wages and salaries. d. expenses and bonuses. e. All of the above are correct.