The closer an income Lorenz curve is to the line of equality, the
A) slower income is growing.
B) more equally income is distributed.
C) less equally income is distributed.
D) faster income is growing.
Ques. 2In 2010, the Center for Disease Control has recommended that every child between the ages of 6 months and 18 years be vaccinated,
except those with a serious egg allergy. Dr. Berreman states,By protecting ourselves from flu, we also protect our families and neighbors. Which is a solution that could be used to achieve a more efficient allocation of resources in the presence of this externality?
A) The government could tax the producers of the flu vaccine.
B) The government could tax the consumers of the flu vaccine.
C) The government could offer a free flu vaccine clinic.
D) The government could increase the price of flu vaccines.
Ques. 3The more closely substitutable are two goods, the
A) more normal looking is the indifference curve for the two items.
B) more closely the indifference curve for these two items approximates a straight line.
C) more tightly curved is the indifference curve for these items.
D) None of the above answers is correct.
Ques. 4Betty consumes only milkshakes and sandwiches and maximizes her total utility. Suppose that the prices of a milkshakes and sandwiches both double and at the same time Betty's income doubles.
Betty buys ________ sandwiches and her marginal utility from sandwiches ________. A) more; increases
B) fewer; decreases
C) more; decreases
D) the same number of; remains the same
Ques. 5Giuseppe's Pizza is a perfectly competitive firm. The firm's costs are shown in the table above. If the market price is 22, the firm will
A) shut down.
B) leave the market in the long run.
C) stay in the market in the long run.
D) incur an economic loss.
Ques. 6Why does the marginal benefit curve have a negative slope?
What will be an ideal response?
Ques. 7In its long-run equilibrium, a firm in monopolistic competition
A) makes zero economic profit and operates with excess capacity.
B) makes zero economic profit and produces above capacity output.
C) makes a positive economic profit and operates with excess capacity.
D) makes a positive economic profit and produces above capacity output.
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