Consumer surplus from a given purchase is the difference between what one was willing to pay for that purchase and what was actually paid
What will be an ideal response?
True. This is the definition of consumer surplus.
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Maria can work as a coal miner, where the probability of being killed in a work-related accident is 5/8,000, or she can earn work as a truck driver, where the probability of being killed in a work-related accident is 2/8,000
Using the compensating differential approach, the value of Maria's life is $4 million. How much more per year will working as a coal miner pay than working as a truck driver? A) $1,500 B) $2,000 C) $2,500 D) $3,500
You are studying with a friend and your friend says, "Private goods are excludable and nonrival, while public goods are nonexcludable and rival." Do you agree?
What will be an ideal response?
If the government requires a natural monopoly to price at marginal cost,
a. monopoly firms will earn zero economic profits because the price of the good equals the cost of producing that good. b. monopoly firms will operate at a loss because P < AC. c. more firms will be able to enter the market. d. producer surplus will increase because quantity supplied is greater.
Keynes argued that the economy naturally achieves full employment because supply creates its own demand
a. True b. False Indicate whether the statement is true or false