In the above figure, if the Lorenz curve were to move closer to the diagonal line containing points b and c, the income distribution would be
A) more unequal.
B) more equal.
C) unchanged.
D) More information is needed to determine how this change would affect the income distribution.
Ques. 2The Coase theorem states that if transaction costs are low, the number of parties is small, and property rights are well established
A) the government must intervene to eliminate any externalities in the market.
B) private transactions are efficient.
C) there will be no pollution.
D) Both answers B and C are correct.
Ques. 3If buyers of illegal goods are punished but sellers are not, then the price ________ and the equilibrium quantity ________.
A) rises; increases
B) rises; decreases
C) falls; increases
D) falls; decreases
Ques. 4The monopoly illustrated in the figure above is unregulated and charges a single price. The deadweight loss created by the monopoly is
A) 0.
B) 22.50.
C) 45.00.
D) 90.00.
Ques. 5Wealth and substitution effects explain why the aggregate demand curve has a positive slope.
Indicate whether the statement is true or false
Ques. 6The figure above shows the situation facing Smart Digit, Inc, a firm in monopolistic competition that produces calculators. What is the firm's profit-maximizing price?
A) 12
B) 10
C) 8
D) 4
Ques. 7Currency appreciation means the price of the currency is decreasing.
Indicate whether the statement is true or false
Quick Reply
