Assume an economy that is producing only one product. Output and price data for a three-year period are as follows. Answer the question on the basis of these data. year units of output price per unit 1 20 4 2 25 4 3 30 6 Refer to the above data. If year 2 is chosen as the base year, in years 1 and 3 the price index values, respectively, are:
a) 4 and 6.
b) 6 and 4.
c) 120 and 100.
d) 100 and 150.
d) 100 and 150.
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In the second circular-flow model of Chapter 2, households have two uses for their total income:
A) consumption and investment. B) consumption and saving. C) saving and investment. D) saving and payment of taxes. E) consumption and payment of taxes.
Suppose Orange Inc sells MP3 players and initially has monopoly power because there are only a few close substitutes available to consumers
As more types of MP3 players are introduced into the market, the demand facing Orange becomes ________ elastic and the Lerner index achieved by the firm in this market ________. A) less, declines B) less, increases C) more, declines D) more, increases
An example of an in-kind benefit is
A. a welfare payment. B. capital gains. C. a charitable contribution of money. D. public housing.
An entrepreneur knits sweaters for sale. The entrepreneur has fixed costs of $100. When he makes 10 sweaters in one month, he must spend $15 on wool. To make eleven sweaters in one month, he must spend $17 on wool. If he has no other costs, what is the marginal cost of the eleventh sweater?
a) $1 b) $2 c) $17 d) $117