The Atlantic City Expressway is a highway that runs from outside Philadelphia to Atlantic City, New Jersey. It is notoriously congested during the summer weekends when many people are driving to the beach about the same time. The marginal private cost for a driver of driving on the Expressway includes
I. the cost of gasoline.
II. the cost of increasing congestion for everyone else.
A) I only
B) II only
C) Both I and II
D) Neither I nor II
A
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Which of the Ten Principles of Economics does welfare economics explain more fully?
a. The cost of something is what you give up to get it. b. Rational people think at the margin. c. Markets are usually a good way to organize economic activity. d. People respond to incentives.
Ceteris paribus, which of the following would cause a decrease in the demand for HD TVs, a normal good?
A. decline in the price of HD TVs. B. increase in the price of HD TVs. C. increase in consumers' income. D. decrease in consumers' income.
Which of the following is consistent with the circular flow of income?I.Goods and services flow in one direction.II.Payments and incomes flow in one direction.III.Sellers receive less than what buyers spend.
A. I only B. II only C. III only D. Both I and II
A vertical demand curve for a particular good implies that consumers are
A) sensitive to changes in the price of that good. B) not sensitive to changes in the price of that good. C) irrational. D) not interested in that good.