An automobile manufacturer voluntarily recalls certain models to fix a defective part at no cost to the owners. This action has the effect of
A. a market failure.
B. the lemon problem.
C. a manufacturer's warranty.
D. none of these.
Answer: C
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The marginal social cost of production is:
A. the sum of the total cost to the producer and the total external cost. B. the sum of the marginal cost to the producer and the total external cost. C. the sum of the total cost to the producer and the marginal external cost. D. the sum of the marginal cost to the producer and the marginal external cost.
Which of the following is a possible cause of an increase in the demand for health care?
a. A young population b. A fall in the purchasing power of households c. An aging population d. A fall in the total population of a country e. Technological advancement
Larry has a comparative advantage over his classmates in writing term papers if he:
A. always earns an A on his term papers. B. can write term papers faster than his classmates. C. has an absolute advantage in writing term papers. D. has a lower opportunity cost of writing term papers than his classmates.
Describe the scope of economic profit in the long run for a perfectly competitive firm
What will be an ideal response?