The economic question of "what to produce" is often referred to as the distribution question
a. True
b. False
B
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In the above figure, if the natural monopoly is regulated using an average cost pricing rule, but the firm can pad its costs and make the regulator believe its costs are LRAC (inflated), then the price the firm charges will increase from
A) $18 to $24. B) $12 to $24. C) $12 to $18. D) $18 to $36.
Why do people specialize and trade?
What will be an ideal response?
During the 2007-2009 financial crisis the currency ratio
A) increased sharply. B) decreased sharply. C) increased slightly. D) decreased slightly.
Jenny's hourly wage rate was increased from $17 to $21. As a result of the wage increase, Jenny desires to work fewer hours and take more hours of leisure. For Jenny
A. the substitution effect must equal the income effect. B. the income effect must be zero. C. the income effect dominates the substitution effect. D. the substitution effect dominates the income effect.