The marginal revenue that would be derived from producing a fifth unit of output is
A. $9.
B. $11.
C. $13.
D. $15.
A. $9.
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"Banks make a profit by paying depositors a high rate to attract funds and making loans at a low rate to encourage borrowing." Is the previous statement correct or not?
What will be an ideal response?
Which of the following statements refers to rent seeking?
A) "The role of the federal government in the U.S. economy grew significantly after the Great Depression. Government spending and taxes are a much greater proportion of total income today than they were in 1929." B) "Laws passed by the federal government often provide benefits for a small number of individuals. These individuals, in turn, have an incentive to contribute to the campaigns of politicians who pass these laws." C) "The federal government should spend more money on programs that help low income citizens and less money on national defense." D) "There is an opportunity cost whenever the federal government spends tax revenue. For example, an additional $1 billion spent on national defense means there will be less revenue for highway construction and maintenance or some other program."
Jane purchases snickle-dees only because her friends do. This is
A) price-leadership. B) negative-sum game. C) positive market feedback. D) negative market feedback.
You are hired as a production analyst at Monopoly-R-Us and you estimate that, at current output, demand is inelastic and marginal cost is positive. You advise your superiors that they can increase profit by
a. raising price until demand becomes unit elastic b. raising price into the elastic range c. lowering price until demand becomes unit elastic d. lowering price into the elastic range e. reduce output without changing price