Suppose that there are only two fishermen, Zach and Jacob, who fish along a certain coast. They would each benefit if a lighthouse were built along the coast where they fish. The marginal cost of building each additional lighthouse is $150. The marginal benefit to Zach of each additional lighthouse is 90 - Q, and the marginal benefit to Jacob is 40 - Q, where Q equals the number of lighthouses. What is the efficient number of lighthouses?
What will be an ideal response?
The cost is too high for any number of lighthouses to be built.
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If the price of gasoline increases and the price of food remains the same, then real income measured in terms of
A) gasoline increases. B) gasoline decreases. C) food increases. D) food decreases.
If the area between the line of equality and the Lorenz curve is 1,250, and the entire area beneath the line of equality is 5,000, the Gini ratio is
A) 0.25. B) 4.00. C) 0.33. D) 0.80.
If a firm goes bankrupt, the bondholders will get paid back before the stockholders get any money
a. True b. False Indicate whether the statement is true or false
What determines the the real interest rate in the long-run classical model?
A. aggregate supply and demand B. money supply and demand C. savings and investment D. inflation