Philip is an average contractor in town, and he earns $40,000 a year. Billy is the best contractor in town, and he earns $480,000 a year. Philip's contracting services
a. are valued more by the market relative to Billy's and that explains why his income is higher than Billy's.
b. are valued less by the market relative to Billy's and that explains why his income is higher than Billy's.
c. are valued less by the market relative to Billy's and that explains why his income is lower than Billy's.
d. are more expensive because he receives a compensating differential.
c
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When money is used to express the value of goods and services, it is functioning as a
A) medium of exchange. B) store of value. C) store of purchasing power. D) unit of account.
Which of the following would be expected if the tariff on foreign-produced shoes were decreased?
a. The domestic price of shoes would fall. b. The supply of foreign shoes to the domestic market would decline, causing shoe prices to rise. c. The number of unemployed workers in the domestic shoe industry would decline. d. The demand for foreign-produced shoes would decrease, causing the price of shoes to increase in other nations.
If an industry has a price leader, it is most likely to be a dominant firm
a. True b. False Indicate whether the statement is true or false
When free riders are present in a market, the market generally fails to provide the efficient outcome
a. True b. False Indicate whether the statement is true or false