If competitive firms experience a loss, over the long run there will be a(n)
a. increase in market supply to reduce the market price
b. increase in market supply to increase the market price
c. decrease in market supply to reduce the market price
d. decrease in market supply to increase the market price
d. decrease in market supply to increase the market price
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Relative to uniform-price policy, price discrimination across segmented markets (sometimes called third-degree price discrimination):
a. always reduces welfare. b. always increases welfare. c. may increase welfare if total output falls. d. may increase welfare if total output rises.
Which of the following is a situation that makes the market behave inefficiently?
a) when consumers do not have enough information to make good choices b) when the producers have the power to find out exactly what to produce c) when both consumers and producers are fully informed about a product d) when the market is in perfect competition and prices are high
Bob plans to spend $60 per month on DVD movie rentals and CDs. The price of a movie rental is $3 and the price of a CD is $15. If Bob rents 5 DVDs per month, how many CDs can he buy?
A) 1 B) 2 C) 3 D) 4
Consumption taxes are generally viewed as
A. regressive. B. progressive. C. simple to calculate. D. multiplicative.