What is the distinction between private cost and social cost?
What will be an ideal response?
A private cost of production is the cost of producing a good or service that is borne only by the producer. A social cost of production includes the private costs of production as well as the external costs of production borne by people other than the producer.
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Refer to Figure 9-5. If the tariff was replaced by a quota which limited coffee imports to 20 million pounds, the amount of revenue received by coffee importers would equal
A) $5 million. B) $15 million. C) $50 million. D) $78 million.
The prices college students and faculty members pay for Apple computers are lower than the prices Apple charges on its Web site and in retail stores. Apple charges lower prices to college students and faculty members because
A) college students and faculty members have a more elastic demand for computers than the general public. B) college students and faculty members typically buy more supplies from Apple (print cartridges, paper, etc.,) than the general public. C) college students and faculty members have a more inelastic demand for computers than the general public. D) Apple can deduct from its federal taxes some of the costs of the computers it sells to college students and faculty members.
Most economists generally argue ________ trying to block technological advances because these technological advances ________.
A. against; are necessary for improved standards of living B. in favor of; increase wage inequality C. against; promote wage equality D. in favor of; cause the economy to grow to rapidly
The figure above shows the demand and cost curves facing a price-setting firm. At what output is marginal revenue $20?
A. 100 units B. 200 units C. 300 units D. 400 units E. 500 units