The set of mechanisms and institutions that resolve the basic economic questions is called the
a. economic system
b. production possibilities dilemma
c. business resolution device
d. absolute advantage determination
e. comparative advantage determination
A
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When a supplier imposes resale price maintenance on its dealers, social gain will increase as long as
a. the supplier chooses to charge a competitive price for its product. b. the value consumers receive from dealer services outweighs their cost. c. dealers are allowed to charge consumers less than the supplier's recommended retail price. d. dealers are able to enter and exit the industry costlessly.
If the marginal benefit of getting a college degree rises, rational people will
A) drop out of college. B) not change their behavior. C) attend college in greater numbers. D) require that college get easier. E) raise the marginal cost of attending college.
A tax on firms for polluting will be most effective in reducing pollution at low cost if the tax
A) is levied on a one-time, lump-sum basis. B) per unit of pollutant is constant. C) per unit of pollutant is lower for low polluting firms. D) per unit of pollutant is proportioned to profits or ability to pay.
Winnie's Car Wash is a perfectly competitive firm. The table above shows Winnie's total product schedule. If the price of a car wash is $4, what is the value of marginal product of the 4th worker?
A) $240 B) $70 C) $10 D) $40