Which of the following is an example of an external cost?
A. Automobile exhaust fumes.
B. Unfair pricing behavior by a monopoly.
C. Eating a sandwich at a local deli
D. Unemployment.
Answer: A
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Based on the model, the price at the efficient equilibrium is
Consider the following model for the production of refined oil: MSC = 10 + 0.5Q; MEC = 0.3Q; MSB = 30 – 0.3Q; MEB = 0. a. PE = $18 b. PE = $22.50 c. PE = $20 d. PE = $40
A surplus will occur in a market if:
A. the quantity supplied at a given price exceeds the quantity demanded at that price. B. the quantity demanded at a given price is less than the quantity supplied at that price. C. there are not enough sellers at the prevailing price. D. there are too many buyers at the prevailing price.
If technological innovation occurs when a firm is experiencing diseconomies of scale:
A. short-run average total costs will fall as output expands. B. the long-run average total cost curve will shift down but will still rise as output expands. C. long-run average total costs will remain the same as output expands. D. product prices will rise, leading to inflation.
How is the international economy qualitatively different in the first part of the 21st century from what it was like in the first part of the 20th century?
What will be an ideal response?