During an economic expansion as consumer incomes rise, holding everything else constant
A) the demand for most goods, except luxuries, will rise.
B) the prices of luxuries will fall while the prices of inferior goods will rise.
C) the demand for luxuries and inferior goods will rise.
D) the demand for luxuries will rise while the demand for inferior goods will fall.
D
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Which of the following statements is INCORRECT?
a. The MSC includes the market-level marginal abatement cost and the government’s cost of enforcement b. If the MSC function is known, total social costs at a given abatement level are found as an area under the MSC c. If the TSC function is known, the marginal social cost of a given abatement level is equal to an area under the TSC d. The MSC of environmental quality is captured by the supply of environmental quality
An increase in the demand for lobster due to changes in consumer tastes, accompanied by a decrease in the supply of lobster as a result bad weather reducing the number of fishermen trapping lobster, will result in
A) a decrease in the equilibrium quantity of lobster and no change in the equilibrium price. B) an increase in the equilibrium price of lobster and no change in the equilibrium quantity. C) a decrease in the equilibrium quantity of lobster; the equilibrium price may increase or decrease. D) an increase in the equilibrium price of lobster; the equilibrium quantity may increase or decrease.
An entrepreneur is considering how many limousines to purchase when he starts up a limousine service. Below are his estimates of the number of limousine rentals the service will make during a year, depending on the number of limousines available.Number oflimousinesTotal numberof rentals13502650390041,10051,250After paying all non-interest expenses, the owner expects to net $10 per rental. Each limousine costs $50,000. How many limousines should he purchase if the real interest rate is 4.5%?
A. 4. B. 2. C. 3. D. 1.
The distinguishing characteristic of labor market monopsonies is the fact that
A. They can hire any number of workers they want without affecting the market wage. B. They must usually hire unionized workers. C. They can pay any wage they want for the number of workers they need. D. Their hiring decisions directly affect the market wage rate.