Lunch in Jamie's dorm is an all-you-can-eat buffet, served from 11 a.m. until 1 p.m. By noon, the buffet is picked over, and by 12:30, there are very few popular items left. The garbage bins, though, are full of food. The buffet in Jamie's dorm is an example of:
A. the tragedy of the commons.
B. an efficient subsidy.
C. excess supply in the market.
D. a good with positive externalities.
Answer: A
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In the capital market, the rental price is what a:
A. consumer pays to gain permanent ownership of a factor of production. B. producer pays to use a factor of production for a certain period or task. C. consumer pays to use labor or land services for a certain period or task. D. producer pays to gain permanent ownership of a factor of production.
When graphing a worker's indifference curves in Probability of Injury (x-axis) versus Wage (y-axis) space, Al's indifference curves are steeper than Pete's indifference curve. In this case,
A. both are risk neutral. B. Al is more risk loving than Pete. C. Al will end up receiving a higher wage than Pete. D. Al requires a greater wage increase than Pete in order to willingly take on more risk. E. Al will only accept a job if it offers no risk of injury.
When a perfectly competitive firm is in long-run equilibrium, economic profits
A) are positive. B) are zero. C) are negative. D) may be positive, zero or negative depending upon costs.
Utils are used by economists to measure the satisfaction a person obtains from consuming a good
Indicate whether the statement is true or false