A free good is a good whose existence requires no opportunity cost to produce. How is this different from a good that is offered for a price of zero?
What will be an ideal response?
A good that is offered at a price of zero may not necessarily have been produced at zero opportunity cost. Often stores give away "free" products to get customers to try them but these products were probably not produced at zero opportunity costs. By that definition they are not free goods.
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Which of the following will hold true if the market for cameras is in equilibrium at a price of $40?
A) The quantity of cameras produced will equal the quantity of cameras bought in the market. B) Sellers of cameras will have an incentive to charge a price higher than $40. C) Buyers of cameras will want to buy fewer cameras than they are purchasing at equilibrium. D) If the cost of producing cameras falls below $40 per camera, all sellers will stop supplying cameras.
Why does a demand curve with a constant slope not have a constant elasticity?
What will be an ideal response?
Suppose that the price of an ounce of gold is 120 pesos in Mexico and 2,400 yen in Japan. Then the Japanese yen is worth two hundred times the value of a Mexican peso
a. True b. False Indicate whether the statement is true or false
Which of the following would be an expected result of substantially higher wages in the U.S. automobile industry?
a. an increase in the real wages of workers outside the industry b. an increase in the price of automobiles produced in the United States c. a reduction in the demand for foreign-produced automobiles d. an increase in the profit rate of U.S. automobile producers