Gains from trade are the:
A. increase in welfare in both countries that results from specialization and trade.
B. increased skills and human capital that results from specialization and trade.
C. transfer of surplus by the receiving country that results from trade.
D. deadweight loss by the losing country that results from trade.
Answer: A
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A 100 acre wood used by four people for collecting firewood is common property. The socially efficient use of the wood could be achieved by assigning property rights
a. only if they go to whichever of the four most values the wood. b. only if they are divided equally among all four users. c. only if the are divided according to those who have been using it the longest. d. to any of all of the four.
Which statement is most accurate about social indicators in the US between 1950 and 1980?
a. The divorce rate doubled. b. The suicide rate rose sharply. c. The murder rate remained relatively constant. d. The birth rate for unmarried women remained relatively constant.
The supply of a good is more price elastic,
a. the fewer alternatives there are to producing the good in question b. the more broadly the market for the good is defined c. the longer the time horizon over which it is measured d. the higher the cost of production e. the more elastic the demand for that good.
Which of the following is the most valid argument against the theory that redistributing income would increase society’s total utility?
a. It is just an assumption that people are alike in how they experience diminishing marginal utility from increasing income. b. Studies have shown that happiness not at all correlated to income levels. c. The main reason that people are able to command high incomes is that they have worked harder than low-income people. d. Studies have shown that income redistribution destabilizes society.