What is market failure?
What will be an ideal response?
Market failure occurs when resources are misallocated or allocated inefficiently.
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Mary is willing to pay $50 for a Christmas tree, John is willing to pay $45 and Jeff is willing to pay $40. The price of a tree is $40. The total consumer surplus for Mary, John and Jeff taken together is
A) $15. B) $135. C) $40. D) $95. E) $120.
According to the misperceptions theory, when the price level falls below the expected price level
A) the economy's SRAS curve shifts up. B) the economy moves along its AD curve. C) the economy moves along its LRAS curve. D) the economy moves along its SRAS curve.
Suggested donations on fundraising items sent to you in the mail is an example of:
A. loss aversion. B. positive framing. C. anchoring. D. rule of thumb.
Taiwan exports tools to the United States. Consumers in Taiwan will probably pay a(n) ________ price for tools with free trade than they would with a closed economy.
A. somewhat lower B. lower C. higher D. more fair