To keep the price at the level set by a price support, the government must
A) buy some of the good.
B) sell some of the good.
C) receive a subsidy from the producers.
D) insure that imports are readily available.
E) be careful to always set the price support below the equilibrium price.
A
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Assume health insurance is provided universally by the government. This would
A) force every taxpayer to bear the costs of adverse selection. B) force every taxpayer to bear the costs of moral hazard. C) force the government to deal with adverse selection problems. D) force foreign governments to deal with moral hazard problems.
A price elasticity of demand of 2.3 implies
a. Demand is inelastic b. Demand is elastic c. Demand is unitary elastic d. Demand is perfectly elastic
Based on the graphs showing price discrimination in movie ticket prices, regardless of which price is charged, the evening movie will generate______ than the matinee.
a. more total revenue than
b. the same total revenue as
c. less total revenue than
d. more variable revenue than
The price of a hotdog is $1, the price of a movie ticket is $5, and the consumer has $13. A consumer has purchased 3 hotdogs and two movie tickets, receiving 10 units of utility for the last hotdog and 10 units of utility for the last movie. The set of goods
A. is an optimum because the consumer has maximized her utility given the limited income she had. B. is not an optimum because the marginal utility for the second hotdog was less than the marginal utility for the first hotdog. C. is not an optimum because the marginal utility per dollar spent is greater for the hotdog than for the movie. D. is an optimum since the entire income is spent and the marginal utility is the same for the last unit of each good.