People respond to incentives. The best way to get people to practice economizing behavior is to:
a. convince them that the behavior will promote the greater good.
b. make sure they will benefit from it.
c. make sure they understand that everyone benefits from their economizing behavior.
d. educate them on how much it will benefit society.
e. establish fixed budgets that limit their freedom to change.
b. make sure they will benefit from it.
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In the United States, government policies with respect to monopolies and collusion are embodied in
A) common law, which the United States adopted from English law. B) the Supreme Court. C) antitrust laws. D) the U.S. Constitution.
An important assumption in the theory of public choice is that
A) individuals will act within the political process to maximize their individual well-being. B) individuals will act within the political process to maximize their collective well-being. C) individuals will only operate outside the political process when their well-being is involved. D) scarcity does not exist in the government sector.
Consider two people, Sandy Ross, who earns $25,000 . and Gary Belcher, who earns $50,000 . If the flat-tax rate is 20 percent, then:
a. the government collects a total of $20,000. b. Gary pays twice the tax amount Sandy pays. c. Gary pays three times the tax amount Sandy pays. d. Gary and Sandy pay exactly the same tax amount. e. Gary pays $15,000 in taxes.
Suppose at a certain quantity of output, a firm's average-total-cost curve lies above its demand curve. At this quantity of output, the firm:
a. is earning negative economic profit. b. is earning zero economic profit. c. is maximizing profit. d. should increase its output to maximize profit. e. should reduce output to maximize negative economic profit.