If a business is earning an economic profit in a competitive market, it is
a. price gouging its customers.
b. exploiting it workers.
c. producing goods and services that are valued more highly than the resources required to produce them.
d. producing goods and services in a market that is characterized by high entry barriers.
c. producing goods and services that are valued more highly than the resources required to produce them.
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Refer to Scenario 13.1. If your negotiated price had been $350 instead of $250, the sum of consumer surplus and producer surplus would be:
A) less than what would have accrued at the $250 price. B) the same as what would have accrued at the $250 price. C) more than what would have accrued at the $250 price. D) None of the above is necessarily correct.
When firms have the ability to change the market price of a good or service, the market failure involved is:
A.) Market power. B.) Public goods. C.) Externalities. D.) Inequities.
Aggressive competition in the foreign market through exports by a domestic firm due to a protected home market is known as
A. seasonal dumping. B. strategic dumping. C. cyclical dumping. D. persistent dumping.
Carlos and Darla are playing the dictator game. Carlos is assigned the role of dictator and given $20 to split between the two of them. Based on previous experiments with this game, if Carlos is a typical player, behavioral economists would expect:
A. Carlos to keep all of the money for himself. B. Carlos to give all of the money to Darla. C. Carlos to split the money evenly with Darla. D. Carlos to split the money, keeping a little more than half for himself.