When a consumer is consuming at a point where his or her budget line is not as steep as his or her indifference curve, then he or she should
A) consume more of the good that is measured on the horizontal axis.
B) consume less of the good that is measured on the horizontal axis.
C) not change his or her behavior.
D) consume none of the good that is measured on the horizontal axis.
Ques. 2In a labor market, employment
A) and the wage rate are higher when the market is a monopsony than when the market is competitive.
B) is higher and the wage rate is lower when the market is a monopsony than when the market is competitive.
C) is lower and the wage rate is higher when the market is a monopsony than when the market is competitive.
D) and the wage rate are lower when the market is a monopsony than when the market is competitive.
Ques. 3Consumers don't always have to pay the maximum price they are willing to pay.
Indicate whether the statement is true or false
Ques. 4The supply curve of low-skilled labor is upward sloping because those workers know that government will protect them with minimum wage legislation.
Indicate whether the statement is true or false
Ques. 5The decision to undertake product development in monopolistic competition is made by comparing the
A) marginal benefit of product development to the marginal cost of product development.
B) average revenue of product development to the average total cost of product development.
C) total revenue of product development to the total cost of product development.
D) firm's expenditure on product development to expenditures by competing firms.
Ques. 6What is the real dilemma facing the prisoners in the prisoners' dilemma game?
What will be an ideal response?
Ques. 7If the equilibrium price for a two-liter bottle of Coca-Cola is 1.50 today, just like it was ten years ago, can we safely say that all supply and demand conditions in the market for Coke have remained very stable all these years?
What will be an ideal response?
Ques. 8Joe, a hair dresser, offers students a discount price on haircuts. This form of pricing is an example of
A) a marginal cost pricing rule.
B) an average cost pricing rule.
C) price discrimination.
D) perfect price discrimination.
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