All of the following are economic functions of the government EXCEPT
A. providing public goods.
B. providing a legal system.
C. promoting competition in the market.
D. determining the wage rate for most jobs.
Answer: D
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Assume a government likes a particular equilibrium along the contract curve. It can achieve that equilibrium through competition and income redistribution
What will be an ideal response?
If a worker has chosen a quantity of labor where the marginal value of leisure exceeds the wage rate, she would be better off by
a. choosing less leisure. b. providing fewer hours of labor. c. providing more hours of labor. d. staying at this combination of labor and consumption.
Taylor's marginal utility from watching movies and from eating out (in utils) is shown in the accompanying table. Taylor spends exactly $100 every month on these two forms of entertainment; the price of each movie is $10 and the price of each dinner is $20.MoviesPer MonthMarginal UtilityPer MovieDinners OutPer MonthMarginal UtilityPer Dinner160115025021403203120454100 Taylor's optimal combination of movies and eating out is:
A. 3 movies and 3 dinners. B. 4 movies and 3 dinners. C. 2 movies and 4 dinners. D. 3 movies and 4 dinners.
Normal profit is:
A. the average profitability of an industry over the preceding 10 years. B. determined by subtracting explicit costs from total revenue. C. the return to the entrepreneur when economic profits are zero. D. determined by subtracting implicit costs from total revenue.