Efficiency is achieved
A) when output is being produced at a point inside a production possibilities curve.
B) when producers are getting the maximum possible output from the available resources.
C) when consumers are able to buy everything that they want.
D) when prices of all goods and services go to zero.
B
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Which one of the following unexpected events ignited the 2009 euro crisis?
A) Accelerating hyperinflation and political upheaval. B) The prospect of a sovereign default by one or more euro zone countries. C) Rising oil prices. D) Revolutions in Switzerland and Belgium. E) A Chinese boycott of European products.
A trade surplus occurs when
A) the value of imports is greater than the value of exports. B) government spending is less than total tax revenue. C) consumption is greater than disposable income. D) none of the above.
Suppose an entrepreneur commits to a production schedule but overestimates the market price for her products. Which situation is not possible?
a. Price equals average total cost. b. Losses are greater than if she shut down. c. Total profit is positive. d. Average variable cost is greater than marginal cost. e. Total profit is zero.
Figure 14.2 represents the market for used cameras. Suppose buyers are willing to pay $125 for a plum (high-quality) used camera and $25 for a lemon (low-quality) used camera. If buyers believe that 50% of used cameras in the market are lemons (low quality), what fraction of used cameras sold will actually be lemons (low quality)?
A. 10/25 B. 10/35 C. 25/35 D. All of the cameras sold will be lemons.