According to the Coase theorem, part of what is needed for private transactions to be efficient is that property rights
A) must be defined, but it does not matter who owns the property.
B) must be defined, and it is crucial as to who owns the property.
C) need not be defined as long as there are no transactions costs present.
D) need to be defined by the government to avoid producers from exploiting high transactions costs.
Ques. 2Andrew's utility of wealth schedule is given in the above table. The table indicates that his marginal utility of wealth ________ as his wealth increases.
A) diminishes
B) is constant
C) increases
D) increases first and then diminishes
Ques. 3If the demand for dog grooming increases so that the price of dog grooming rises, then number of workers hired by Doug's Dog Grooming would
A) decrease.
B) increase.
C) remain unchanged.
D) Any of the above answers are possible.
Ques. 4When the price of the good or service it produces rises, the firm's
A) demand for labor curve shifts rightward.
B) demand for labor curve shifts leftward.
C) demand for labor curve remains unchanged.
D) output decreases.
Ques. 5The above figure shows the demand and cost curves for a firm. The figure shows a
A) monopolistically competitive firm in the long run.
B) perfectly competitive firm earning zero profit.
C) monopolistically competitive firm in the short run.
D) perfectly competitive firm in the short run.
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