Biology Forums - Study Force

In the short run, a sales tax is:
 a. wholly absorbed by the producer.
  b. shared between the consumer and the producer.
  c. deferred until the market is able to re-establish an equilibrium price.
  d. wholly absorbed by the consumer.

QUESTION 2

Appendix: Incentive-compatible revelation mechanisms attempt to
 a. induce an employee to reject the next best alternative employment opportunity
  b. elicit privately-held information
  c. secure enforcement primarily by third parties
  d. reject voluntary contracting with third parties
  e. impose similar risk premiums on all employees

QUESTION 3

If the bidders at an oral auction have true values of 8, 7, 6, and 5, the item will sell for
 a. 8
  b. 7
  c. just over 7
  d. just under 7

QUESTION 4

A market for a product for which demanders are willing to pay more than costs of production may not arise because of:
 a. high transactions costs.
  b. strict price controls.
  c. the inability of producers to gain economies of scale.
  d. foreign countries dominating a domestic market for a product.

QUESTION 5

Appendix: An incentive-compatible revelation mechanism is
 a. self-enforcing
  b. always multi-period
  c. too complicated to influence decisions
  d. prevalent in vertically integrated businesses
  e. not adopted by franchise businesses

QUESTION 6

The optimal bidding strategy for a second-price auction is
 a. To bid your true value
  b. To shade your bid well below your true value
  c. To shade your bid just a little below your true value
  d. To size up your competition to determine how much to shade your bid

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