Refer to Common Property I. Suppose the common property becomes privately owned. The owner behaves competitively and charges people an entrance fee for the right to use the property. In this situation, how are the gains from trade divided between the owner and the users of the property?
a. The owner receives area C + D, and the users receive area A + B.
b. The owner receives area C, and the users receive area D.
c. The owner receives area E, and the users receive area A + B + C + D.
d. The owner receives area C + D, and the users receive zero.
d. The owner receives area C + D, and the users receive zero.
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Consider the following linear demand function where QD = quantity demanded, P = selling price, and Y = disposable income: QD = ?36 ?2.1P + .24Y The coefficient of P (i.e., ?2.1) indicates that (all other things being held constant):
a. for a one percent increase in price, quantity demanded would decline by 2.1 percent b. for a one unit increase in price, quantity demanded would decline by 2.1 units c. for a one percent increase in price, quantity demanded would decline by 2.1 units d. for a one unit increase in price, quantity demanded would decline by 2.1 percent e. none of the above
How can the multiplier help macroeconomic policymakers determine how much additional investment or government purchases are necessary to reach full employment?
What will be an ideal response?
Why is a period of stagflation part of the normal aftermath of a period of excessive aggregate demand?
In the basic competitive model of labor markets, we see that
A. individual firms and workers have no control over the wage rate paid and received. B. there are only long-term contracts. C. individual firms and workers can exert a lot of influence over the wage rate. D. jobs are not identical to each other.