Why would Sunkist incur substantial costs to advertise and establish a brand name when the quality of its oranges can easily be evaluated by consumers?
What will be an ideal response?
Oranges might be considered as experience goods, whose quality in terms of taste and sweetness can be established only after consumption. Because of this characteristic, the Sunkist brand name can convey a signal of high quality to consumers.
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Which statement is false?
A. The 1990s was one of the most prosperous decades in the United States' history. B. The United States' economy reached its tenth year of steady expansion in the spring of 2001. C. Compared to other decades, the 1990s was a decade was unique in that it had strong economic growth with no recessions. D. At the end of the 1990s, the government was running budget surpluses.
If that the marginal propensity to save (MPS) increased from 0.20 to 0.25, this would cause the multiplier effect to
A) increase. B) decrease. C) stay the same. D) None of the above is correct.
About what percentage of marketable national debt is held by foreigners?
A) 5 percent B) 15 percent C) 25 percent D) 50 percent
On Saturdays, Stan goes to the park to play his saxophone. Some of the people in the park love listening to Stan play, while others find his music really annoying. In this case, Stan's saxophone playing generates:
A. a positive externality. B. both positive and negative externalities. C. a negative externality. D. neither a positive nor a negative externality.