Let the quantity of hamburgers be measured along the vertical axis and the quantity of movies be measured along the horizontal axis. If the price of a hamburger is $1.50 and the price of a movie is $6, then the slope of the budget line is
A) -6.
B) -4.
C) -3.
D) -0.25.
Answer: B
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Use the following supply and demand graph to answer the question below.
S1 and D1 represent the current market supply and demand, respectively. S2 and D2 represent the socially optimal supply and demand. The positions of the graphs indicate that there is (are) external
A. benefits from production and external costs from consumption of the product. B. costs from production and external benefits from consumption of the product. C. costs from production and consumption of the product. D. benefits from production and consumption of the product.
Suppose new electronic devices make it easier to monitor the effort levels of workers. If some shirking is still possible in the efficiency wage model, what happens to the level of employment?
A) Increases, but some unemployment remains B) Increases, and the labor market reaches full employment C) Decreases D) Does not change
Which of the following is NOT an example of a transaction cost?
A) the enjoyment of owning the good B) the opportunity cost of time spent looking for stores that sold the good desired C) the cost of returning a defective product D) time spent bargaining over the price of a good
Human capital is associated with
a. a doctor charging lower-income patients less b. a doctor paying rent for the office c. a doctor's stethoscope d. a doctor's knowledge of political events e. a doctor's skills in the operating room