Suppose a consumer has an income of $800 per month and that she spends her entire income each month on beer and bratwurst. The price of a pint of beer is $5, and the price of a bratwurst is $4 . Which of the following combinations of beers and bratwursts represents a point that would lie to the interior of the consumer's budget constraint?
a. 160 beers and 200 bratwursts
b. 40 beers and 50 bratwursts
c. 80 beers and 100 bratwursts
d. 160 beers and 0 bratwursts
b
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If the supply of automobiles becomes more inelastic, then a tax on automobiles is
A) paid more by the buyers after the change than before. B) paid more by the sellers after the change than before. C) always split evenly between the buyers and the sellers. D) paid more by the government after the change than before. E) always paid entirely by the buyers.
A price-discriminating firm charges the highest price to
A) the group with the least elastic demand. B) the group with demand that is unit elastic. C) the group with the largest demand. D) the group with the most elastic demand.
Unlimited liability exists when
A) the profits of the firm are taxed once. B) a firm dissolves when the owner dies. C) a corporation exists. D) the personal assets of the owner of a firm can be seized to pay off the firm's debts.
Technical change which results in a change in the production process is known as
A. technical catch-up. B. per-capita technical change. C. disembodied technical change. D. embodied technical change.