If Sean sells Susan a DVD player for $30, we would expect that Select one:
a. Both Shawn and Susan will gain from this transaction.
b. Sean will gain from the transaction, but Susan will lose.
c. Susan will gain from the transaction, but Sean will lose.
d. The well-being of both parties will be unchanged.
a. Both Shawn and Susan will gain from this transaction.
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A tax is regressive if it
A. is levied on consumers. B. takes a smaller percentage of income as income increases. C. takes a higher percentage of income as income increases. D. takes the same percentage of income regardless of income level.
If the economy is characterized by diminishing or decreasing returns to scale, then a
A) doubling of inputs will lead to a constant output. B) doubling of inputs will lead to a constant output. C) doubling of inputs will lead to a two-fold increase in output. D) doubling of inputs will lead to a less than two-fold increase in output.
If a good is offered to you free of charge, then you
a. never stop consuming it b. stop consuming it when its marginal utility begins to fall c. stop consuming it when its marginal utility begins to increase d. stop consuming it when its marginal utility equals 0 e. stop consuming it when its total utility equals 0
Which of the following is a possible result of adverse selection?
a. Only lemons remain in the market for used cars. b. A store manager shirks his responsibility because his supervisor is not present at all times. c. A car mechanic does not bother to properly fix the customers' cars when his work cannot be monitored. d. Many people selling their houses at very low prices expecting prices to decline further.