If output is at 3 units, then the market ____ allocative efficiency and _____ productive efficiency.
Use the table below to answer the following question.
| Units | Maximum Willingness to Pay | Market Price | Minimum Acceptable Price |
| 1 | $14 | $8 | $2 |
| 2 | 12 | 8 | 4 |
| 3 | 10 | 8 | 6 |
| 4 | 8 | 8 | 8 |
| 5 | 6 | 8 | 10 |
| 6 | 4 | 8 | 14 |
A. achieves, achieves
B. achieves, does not achieve
C. does not achieve, achieves
D. does not achieve, does not achieve
Answer: D
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Refer to Figure 24-2. Ceteris paribus, an increase in the expected future price level would be represented by a movement from
A) SRAS1 to SRAS2. B) SRAS2 to SRAS1. C) point A to point B. D) point B to point A.
In the case where interest rates are lower in Japan, which of the following is an example of a "carry trade"
a. Increase borrowing in the US, convert to Yuan and invest in financial assets in Japan b. Increase borrowing in Japan and invest in Japan c. Increase borrowing in Japan, convert to Dollars and invest in the US d. Increase borrowing in the US and invest in the US
Which of the following is a normative statement? a. An increase in taxes will cause higher unemployment
b. An increase in tariffs will increase the domestic prices paid by consumers. c. Income should be redistributed from the top 2% of wage earners to the lower income brackets. d. Running government budget deficits leads to higher market interest rates.
An oligopolistic firm that is part of a collusive agreement is less likely to cheat
a. the more punishment it expects if the cheating is detected b. the lower is the possibility of detection c. the less likely is the collapse of the entire agreement as a result of cheating d. the greater is the additional profit from charging a lower price than the other firms e. the higher is the chance of taking customers away from competitors by charging a lower price