A professional hockey franchise is trying to assemble a parcel of land to build an arena. There is one vacant warehouse on the land the franchise needs. In this case,
A) eminent domain will reduce transactions costs and make a pie-increasing arena possible.
B) eminent domain will reduce the likelihood of holdouts and make a pie-increasing arena possible.
C) eminent domain is not called for as the land can probably be acquired more efficiently through bargaining.
D) Both A and B are correct.
C
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Empirical evidence suggests that usury laws
A) help poor consumers by lowering the interest rate they pay. B) hurt poor consumers by limiting their ability to borrow. C) keep interest rates low. D) limit the amount borrowed by wealthier consumers.
Suppose that everyone who has looked for a job for more than six months gave up in despair and stopped looking. What would happen to the unemployment rate? a. It would increase
b. It would fall. c. It would change, but the effect cannot be predicted. d. It would not change.
What do economies of scale, the ownership of essential raw materials, and patents have in common?
A. They must all be present before price discrimination can be practiced. B. They are all barriers to entry. C. They all help explain why a monopolist's demand and marginal revenue curves coincide. D. They all help explain why the long-run average cost curve is U-shaped.
A decrease in the demand for American-made goods will
A) increase the supply of dollars in the foreign exchange market. B) decrease the supply of dollars in the foreign exchange market. C) increase the demand for dollars in the foreign exchange market. D) decrease the demand for dollars in the foreign exchange market.