If we were the only two people in the world and I like bananas while you hate them, efficiency demands that I get all bananas.
Answer the following statement true (T) or false (F)
True
Rationale: If you get any bananas, we can make both of us better off by taking some of your bananas and giving them to me.
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Describe the differences between classical and Keynesian economists in terms of their views about monetary neutrality
What will be an ideal response?
Using the above figure, if the government levies a new unit tax in this market, S represents the original supply curve, and St represents the after-tax supply curve, then the revenues that the government collects from imposing this tax is represented
on this graph by A) OAEG. B) OBCG. C) BAEC. D) CEF.
Suppose product price is $24; MR = MC at Q = 200; AFC = $6; AVC = $16 . What do you advise this competitive price-taker firm to do?
a. Increase output. b. Decrease output. c. Shut down operations. d. Stay at the current output; the firm is earning a profit of $400. e. Stay at the current output even though the firm is losing $200.
Athos, Porthos,and Aramis each like to take fencing lessons. The price of a fencing lesson is $11 . Athos values a lesson at $16, Porthos at $14, and Aramis at $12 . Suppose that if the government taxes fencing lessons at $2 each, the price will rise to $13 . A consequence of the tax is that consumer surplus shrinks by
a. $4 and tax revenues increase by $6, so there is a deadweight loss of $2. b. $6 and tax revenues increase by $6, so there is no deadweight loss. c. $5 and tax revenues increase by $6, so there is no deadweight loss. d. $5 and tax revenues increase by $4, so there is a deadweight loss of $1.