If a profit-maximizing firm in a competitive market discovers that, at its current level of production, price is greater than marginal cost, it should
a. shut down.
b. reduce its output but continue operating.
c. continue to produce at the current levels.
d. increase its output.
d
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Refer to Scenario 9.1. The Nash equilibrium occurs when Sheb places ________ sheep on the commons and Monty places ________ sheep on the commons
A) 4; 4 B) 4; 5 C) 5; 4 D) 5; 5
Which of the following tax systems is the most fair?
a. proportional taxes b. regressive taxes c. progressive taxes d. There is no objective way to assess fairness among the three systems.
The median-voter theorem explains why
a. politicians take extreme stands on issues. b. voters are attracted to political outsiders. c. two opposing politicians tend to take opposite sides of each issues. d. politicians tend to take middle-of-the-road positions.
The price mechanism is:
A. affected by both political and social forces. B. affected by political but not social forces. C. affected by social but not political forces. D. not affected by social and political forces.