Refer to Edgeworth Box Economy. Analysis of an Edgeworth box economy shows that a competitive equilibrium
a. must be Pareto optimal.
b. can be located anywhere along the contract curve.
c. may lie anywhere within the region of mutual advantage.
d. must lie to the southeast of the endowment point.
a. must be Pareto optimal.
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One reason why the average salary of Major League Baseball players is higher than the average salary of college professors is
A) competition among baseball club owners forces player salaries to be much higher than the players' marginal revenue products. B) the marginal revenue product of baseball players is greater than the marginal revenue product of college professors. C) the careers of most baseball players are much shorter than the careers of most college professors. D) college professors accept lower salaries in exchange for better working conditions.
The more good substitutes there are for a product, the more likely it is that the total revenue for the good in question would increase as a result of an increase in price
a. True b. False Indicate whether the statement is true or false
In 1991, the French mineral water Perrier was temporarily taken off the market in the United States because of suspected impurities. Other things equal, this action brought about:
a. an increase in the demand for Perrier. b. a decrease in the price of Perrier in terms of French francs. c. a depreciation of the French franc relative to the U.S. dollar. d. an appreciation of the French franc relative to the U.S. dollar. e. an increased supply of dollars in the foreign exchange market.
Economists must actually measure the utilities of goods to determine demand
Indicate whether the statement is true or false