Commercial airlines have two primary suppliers of large jet aircraft: Boeing and Airbus
Since millions of people fly with commercial airlines each year, should these aircraft manufacturers be required to incorporate every possible safety feature into the aircraft they manufacture? Should the manufacturers be allowed to incorporate no safety features? If some safety considerations are to be required, how would an economist decide on which features to include and which not to include?
Some safety measures would save so few lives that requiring them to be installed would not be cost-justified. Some safety measures are highly effective and save lives at relatively low costs, so installing them would be cost justified. An economist would choose to install those features that are cost justified and not install those that are not.
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The use of money adds to wealth because it tends to increase people's
A) options. B) risks. C) costs. D) expenditures. E) elasticity of demand.
If there are low barriers to entry, a monopolist
A) might undertake investment to lower marginal cost in the face of a potential rival. B) will undertake investment to lower marginal cost in order to increase profits. C) will not undertake investment to lower marginal cost under any circumstances because profits are lower. D) Both A and B.
Behavior on the part of the firm that allows it to comply with the letter of the law but violate the spirit reducing the law's effect is
A) asymmetric information. B) creative response. C) the lemons problem. D) only a problem in a monopoly.
Eric lost his job because a recession caused his employer's sales to fall. This is an example of:
A. involuntary unemployment. B. frictional unemployment. C. structural unemployment. D. cyclical unemployment.