A rightward shift in the demand curve for tennis balls could be caused by
a. a fall in the price of tennis balls.
b. a fall in the price of tennis rackets.
c. a rise in the price of tennis lessons.
d. a fall in income, assuming tennis balls are a normal good.
The price charged by a perfectly competitive firm is determined by
a. the firm’s demand curve alone.
b. the firm’s cost curves alone.
c. market demand and market supply, together.
d. market demand alone.
e. market supply alone.
The major economic objective of cartels is to
a. impose their political will on others.
b. restrict output, push up price, and increase profits.
c. reduce costs.
d. develop new ways of doing things.
e. b and d
__________ scale exist when inputs are increased by some percentage and output
increases by a smaller percentage, whereas __________ scale exist when inputs are
increased by some percentage and output increases by the same percentage.
a. Economies of; diseconomies of
b. Constant returns to; economies of
c. Diseconomies of; constant returns to
d. Diseconomies of; economies of
Government can overcome the free rider problem by collecting taxes and using the
funds to provide individuals with nonexcludable public goods that they want to buy but
the market cannot provide.
a. True
b. False
At a price of $10, there is a ____________ unit____________ of good X.
a. 340; surplus
b. 230; shortage
c. 60; surplus
d. 340; shortage
e. 270; shortage
Approximately how much is $25,000 to be received a year from now worth today at an
interest rate of 6 percent?
a. $26,500
b. $85,556
c. $23,585
d. $20,385
Exhibit 24-3
The profit-maximizing single-price monopolist produces output
a. q1.
b. q2.
c. q3.
d. q4.
When the monopoly firm sells two units of its product, it earns total revenue of $260
and it incurs a total cost of $210. If its marginal revenue for the second unit was $110,
what was the marginal revenue of the first unit?
a. $100
b. $150
c. $133
d. $220
e. There is not enough information to answer the question.
Economists David Zizzo and Andrew Oswald found that the majority of their study
participants made themselves worse off in order to make someone else worse off.
a. True
b. False
Exhibit 24-7
The maximum profits earned by a single-price monopolist producing good X are
a. $9,000.
b. $4,500.
c. $2,250.
d. $1,125.
What is the difference between macroeconomics and microeconomics? Give an
example of a question that a macroeconomist might be interested in answering, then do
the same for a microeconomist.
Describe the similarities between why sellers want to price discriminate and why
district attorneys want to plea-bargain.In addition, discuss the conditions that must be
satisfied before district attorneys (DAs) can plea-bargain successfully and how they
relate to the three conditions necessary for successful price discrimination.
Explain why the ceteris paribus assumption is essential when assessing an economic
theory.Give an example to help support your answer.
What is the difference between macroeconomics and microeconomics? Give an
example of a question that a macroeconomist might be interested in answering, then do
the same for a microeconomist.
What is the difference between a vertical merger and a horizontal merger?Which one is
the Justice Department more likely to look at more carefully and why?
Compare and contrast the following market structures: perfect competition and
monopolistic competition.
Explain why the price of a good tends to fall when there is a surplus of the good.Give a
hypothetical numerical example to help support your answer.