Figure 9.1 represents the market for used bikes. Suppose buyers are willing to pay $200 for a plum (high-quality) used bike and $50 for a lemon (low-quality) used bike. If buyers believe that 50% of used bikes in the market are lemons (low quality), what fraction of used bikes sold will actually be plums (high quality)?
A. 8/30
B. 22/30
C. 8/22
D. 30/30
Answer: A
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Competitive firms earn zero profit in the long run when
A) entry is completely free. B) entry is limited. C) Both A and B. D) Neither A nor B.
According to the above figure, a shortage will occur at a price at which
A) quantity demanded equals quantity supplied. B) quantity demanded exceeds quantity supplied. C) quantity supplied exceeds quantity demanded. D) government sets a price above equilibrium.
A copyright
a. is required to sell printed material b. grants exclusive rights over the protected material for at least seventy years c. is granted only to best original works of art, literature, and music d. grants the right to copy certain material such as printed material e. grants communal rights over the protected material for at least seventy years
Which set of points would show a movement from depression to full employment?
A. a movement from Point C to B
B. a movement from Point B to A
C. a movement from Point C to E
D. a movement from Point D to C