If the inverse demand curve a monopoly faces is p = 100 - 2Q, and MC is constant at 16, then the firm's Lerner Index equals
A) 58/16.
B) 16/42.
C) 58/42.
D) 42/58.
D
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Recall the Application. The change in demand for cigarettes resulting from the decrease in taxes would normally create, ceteris paribus
A) a decrease in their quantity supplied. B) a decrease in their supply. C) an increase in their supply. D) an increase in their quantity supplied.
Suppose the working-age population of a fictional economy falls into the following categories: 30 are retired; 45 are stay-at-home parents; 120 are employed full time; 40 are employed part time; 25 are unemployed but are actively looking for
employment; 15 are unemployed and are not actively looking for employment. The official unemployment rate as calculated by the BLS would be A) 9.62%. B) 13.51%. C) 14.55%. D) 20.0%.
What is a risk measure?
a. Alpha b. Required return on the market portfolio c. Standard deviation of historical returns
Suppose the United States chose to legalize the production and use of marijuana, but also decided to put a tax on the good (with the tax paid by producers). After doing so, suppose that the price that consumers paid rose, and the amount that growers got to keep fell. This would
A. indicate that the demand-side effect was smaller than the net supply-side effect. B. be shockingly counter-intuitive, because there would be no supply-and-demand model that could explain it. C. suggest that the supply curve is vertical. D. indicate that the demand-side effect was greater than the supply-side effect.