Which feature of a market would contribute most to overall social welfare?
a. Low prices and high outputs
b. Reduction in costs due to technological improvements
c. The invention of new products
d. Difficult to weigh a, b, and c without further information about society's preferences
d
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Suppose GDP ________ the level of potential output. We would expect to see ________ unemployment, rising wages, and rising prices.
A. exceeds; low B. is? below; low C. is? below; high D. exceeds; high
Second-degree price discrimination is the practice of charging
A) the reservation price to each customer. B) different prices for different quantity blocks of the same good or service. C) different groups of customers different prices for the same products. D) each customer the maximum price that he or she is willing to pay.
A critical assumption
a. makes an economic model a more concrete representation of reality b. eliminates unnecessary details from an economic model c. has an important impact on the conclusions of an economic model d. is usually implicit in an economic model e. increases the level of abstraction of an economic model
Social cost is
a. private cost minus external cost b. the same as external cost c. the same as production cost d. private cost divided by external cost e. private cost plus external cost