One way DeBeers managed to maintain control over the diamond industry was to:
A. punish consumers who sought to store their wealth in diamonds.
B. continue to be the sole diamond producer by buying all existing diamonds.
C. create the illusion of no close substitutes through marketing.
D. All of these statements are true.
Answer: C
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Refer to Exhibit 16-11. Assume that the starting point is point 1. Suppose that there is a supply-side change capable of reducing the capacity of the economy to produce. Which of the following best goes with the diagram shown?
A) New classical theory with policy incorrectly anticipated, bias downward
B) New classical theory with policy incorrectly anticipated, bias upward
C) Real business cycle theory
D) New classical theory with policy unanticipated
E) Policy ineffectiveness proposition (PIP)
Social Security is an earmarked tax
a. True b. False
Receiving a voucher for an apartment in a public housing project would be an example of a good that satisfies
A) the principle of rival consumption. B) the definition of a public good. C) the definition of a good with a positive externality. D) the nonexclusion principle.
The marginal product curve is a mirror image of
a. The average cost curve b. The average fixed cost curve c. The total cost curve d. The marginal cost curve