Which of the following is an example of peak-load pricing?
A) Charging less for vacations to Hawaii during December and January
B) Charging more for electricity on hot days
C) Setting price equal to marginal cost when there is a capacity constraint
D) Selling excess capacity at lower prices
B
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The Coase theorem is significant because it
A. implies that no transaction costs are associated with solving externalities. B. shows that property rights can be assigned. C. shows that under certain conditions externalities can be corrected in the market without resorting to nonmarket means. D. a and b
After trading in her Volkswagen Beetle for a much safer Mercedes sedan, Rene began driving less carefully. This is an example of: a. adverse selection
b. free-riding. c. moral hazard. d. Positive externalities.
Consider Figure 12.5. Figure 12.5 illustrates the payoffs of a game where both players play the game:
A. sequentially. B. simultaneously. C. forever. D. over a period of 8 years.
Which of the following will lead to an outward shift in the firm's short-run demand for labor?
A) an increase in the price of output B) less capital per unit of labor C) a decline in labor productivity D) a reduction in average consumer income