Suppose that Tom bought a bike from Helen for $195. If Helen's reservation price was $185, and Tom's reservation price was $215, the total economic surplus from this transaction was:
A. $215
B. $195
C. $185
D. $30
Answer: D
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A country with an official settlements balance of zero and a negative current account balance is a
A) net creditor. B) net lender. C) net borrower. D) net saver. E) None of the above answers is correct because it is not possible to have an official settlements balance of zero and a negative current account balance.
Refer to Table 2-1. Assume Dina's Diner only produces sliders and hot wings. A combination of 40 sliders and 50 hot wings would appear
A) along Dina's production possibilities frontier. B) inside Dina's production possibilities frontier. C) outside Dina's production possibilities frontier. D) at the vertical intercept of Dina's production possibilities frontier.
Income inequality increases as the Gini coefficient approaches 1
Indicate whether the statement is true or false
A monopolistically competitive market is characterized by:
a. many small sellers selling a differentiated product. b. a single seller of a product that has few suitable substitutes. c. very strong barriers to entry. d. mutual interdependence in pricing decisions.