The above figure shows the total revenue curve for Dizzy Discs. The demand curve for CDs sold by Dizzy Discs
A) has negative slope.
B) has positive slope.
C) is horizontal.
D) is vertical.
C
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Suppose transactions costs are created by a principal-agent problem. If the objective is economic efficiency, who should be made liable for damages resulting from the interaction of the principal and the agent?
a. The principal should be liable for all damages. b. The agent should be liable for all damages. c. Liability for damages should be equally split between the principal and the agent. d. The assignment of liability is irrelevant according to the Coase Theorem.
Consider an apple orchard owner deciding how to incentivize his fruit pickers. He pays per pound harvested but adjusts the compensation rate higher during poor harvest seasons. As a consequence
a. The compensation rate should be fixed at all times b. The pickers might try to game the system by discouraging others from harvesting too much c. The pickers would claim good harvests in order to be paid higher piece rates even during poor harvest seasons d. None of the above
"Ensuring that Social Security is financially sound for future generations is an important use of taxpayer dollars" is an example of a
a. normative economic statement. b. positive economic statement. c. statement made by an economist working as a scientist. d. judgment based on evaluation of evidence, not values.
Salespersons are often a good source of external information in the consumer decisions making process.
a. true b. false