Marginal benefit curves
A) have positive slopes.
B) have negative slopes.
C) are horizontal lines.
D) are vertical lines.
E) are upside-down U-shaped curves.
B
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A new car in the dealer's showroom had a sticker price of $35,900. Sally liked the car but decided she would pay no more than $32,000 for it, otherwise she would do without it. After haggling with the dealer, she purchased the car for $31,500
Did she gain any consumers surplus? If so, how much? If not, why not?
The Coase theorem argues that the assignment of property rights will generate an efficient solution to the problem of
a. positive externalities as long as bargaining costs are small b. negative externalities as long as bargaining costs are small c. negative externalities as long as bargaining costs are great d. any type of market failure e. any type of market failure that involves high transaction costs
Todd owns a painting company. He needs brushes, ladders, paint, painters, and a truck in order to produce even one painted house. If it takes one hour to set up and take down the equipment each day, would Todd care if his employees worked an 8-hour day or a 10- hour day, assuming that each hour they painted just as quickly as the previous hour?
a. no; the revenue and costs are the same every hour b. no; especially if he pays his employees by the hour c. there is no way to answer this question d. yes; because he can reduce the average fixed cost of preparation and clean-up e. yes; but only if the homeowner pays by the hour
Define comparative advantage