Which of the following most accurately states the function of middlemen?
a. Middlemen add to the expense of buyers and sellers without providing any benefit.
b. Our economy would work just as well without middlemen since they do not expand the availability of physical goods.
c. Middlemen reduce the number of transactions since they increase the buyer's price and reduce the seller's net revenue.
d. Middlemen create value by arranging trades and providing information to buyers and sellers.
D
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To achieve the optimal provision of public goods,
a. the market should be allowed to find its equilibrium without government interference b. the government must limit the provision of these goods c. the government must levy taxes on producers of these goods d. the government must either provide the goods at prices different from those established on the market, or subsidize the production of those who provide thegoods e. a tax must be imposed on consumers equal to the negative externality
If the cross-price elasticity between goods X and Y is zero, we know the goods are:
A. independent. B. substitutes. C. inelastic. D. complements.
Fill in this table. Assume that fixed cost is $100.
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