The decisions of buyers and sellers that affect people who are not participants in the market create
a. market power.
b. externalities.
c. profiteering.
d. market equilibrium.
b
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The marginal cost of production that is borne by the entire society is called the marginal
A) private cost. B) social cost. C) external cost. D) public cost. E) user cost.
A technological breakthrough in using photons for computers will increase the productivity of those working with computers a hundredfold. You would expect this breakthrough to shift the
A) marginal product of labor curve up and to the right, raising the quantity of labor demanded at any given real wage. B) marginal product of labor curve down and to the left, reducing the quantity of labor demanded at any given real wage. C) labor supply curve up, reducing the quantity of labor demanded at any given real wage. D) labor supply curve down, raising the quantity of labor demanded at any given real wage.
A tax cut that raises the after-tax wage rate will most likely result in more hours worked if
A) tax rates were low already. B) the relevant portion of the labor supply curve is upward sloping. C) the relevant portion of the labor supply curve is downward sloping. D) workers can be easily fooled.
Problems are most likely to arise when:
A. complete information is impossible to obtain. B. people have good enough information to make acceptable choices. C. one person knows more than another. D. both parties lack the same information.