Which of the following is a characteristic of a perfect competition?
a. Firms can enter and exit a market freely.
b. Two or three firms produce identical products.
c. A few buyers are available to purchase a good.
d. Sellers and buyers have limited product information.
a. Firms can enter and exit a market freely.
In perfect competition, firms can freely enter and exit a market.
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If on Tuesday the perceived price of studying for an exam is $4 per hour but on Saturday the perceived price of studying for an exam is $10, the law of demand predicts
A) more studying on Saturday and less on Tuesday. B) more studying on Tuesday and less on Saturday. C) the same amount of studying on Tuesday and Saturday. D) no studying on Tuesday or Saturday.
Define the benefit principle. List two real world taxes that have the features of a tax based on the benefit principle. Why can't the benefit principle be the sole principle of taxation?
What will be an ideal response?
If people spend 30 percent less on movie tickets when movie prices decline 15 percent, the price elasticity of demand for movie tickets at these prices must be
a. -3.0. b. elastic c. -0.5. d. inelastic.
When a rise in the price of one item results in a decrease in the demand for another good, then the two goods are
A. satisfying the law of supply. B. substitute goods. C. inferior goods. D. complementary goods.