Answer the following statement true (T) or false (F)
1) Higher user costs imply that a resource should be extracted more quickly.
2) The total cost of extracting and selling a resource in a given year is the sum of the extraction
cost and user cost.
3) The higher a resource's current price, the more extraction should be delayed to a later period.
4) User cost is defined as the present value of the profit the company would earn if it delayed
extraction until next year.
1) F
2) T
3) F
4) T
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Which of the following statements about the comparison between GDP in China and in the United States is CORRECT?
A) Using the exchange rate to value China's GDP in dollars shows that China's GDP per person exceeds the GDP per person in the United States. B) Using purchasing power parity prices to value China's GDP in dollars shows that China's GDP per person exceeds the GDP per person in the United States. C) China's GDP per person is higher using purchasing power parity prices rather than the exchange rate when valuing China's GDP in dollars. D) None of the above answers are correct because they are all false statements.
An increase in the demand for orthodontic services leads to
A) an increase in the supply of orthodontists. B) a rise in the rates of dental insurance. C) lower prices for orthodontic care. D) an increase in the demand for orthodontists.
Exhibit 2-11 Production possibilities curves
In Exhibit 2-11, which of the following could have caused the production possibilities curve of an economy to shift from the one labeled A to the one labeled B?
A. A major natural disaster B. An increase in consumption goods production this year C. An advance in technology D. An increase in unemployment
All of the following are examples of negative effects of imposing rent control except:
A. persons who get a place to live pay lower rent. B. renters must pay non-refundable security deposits. C. producer surplus decreases. D. some people who would have rented apartments before rent control will not rent.