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ECON 231 Final Exam Review || Already Passed.
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Taxes create deadweight losses because they correct answers distort incentives The efficient scale of the firm is the quantity of output that correct answers minimizes average total cost Which of the following is not an example of the principle that can make everyone better off A. Americans ...

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  • August 16, 2024
  • 5
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

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  • taxes create deadweight losses because the

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  • ECON 231
  • ECON 231

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ECON 231 Final Exam Review || Already Passed.
Taxes create deadweight losses because they correct answers distort incentives

The efficient scale of the firm is the quantity of output that correct answers minimizes average
total cost

Which of the following is not an example of the principle that can make everyone better off
A. Americans buy tube socks from chine
B. A homeowner hires the kid next door to mow the lawn
C. Residents of Maine Drink orange juice from flordia
D. All of the above are examples of the principles that trade can make everyone better off correct
answers All of the above are examples of principle of trade that can make everyone better off

When a good is excludable correct answers people can be prevented from using the good

Competitive Markets are characterized by correct answers free entry and exit by firms

A key characteristic of a competitive market is that correct answers producers sell nearly
identical products

In the absence of market failures, the Invisable hand leads a market to maximize correct answers
total benefit to society from the market

When a monopolist is able to sell its product at different prices, it is engaging in correct answers
price distribution

Kevin is the CEO of a large firm and a homeowner who pays a landscaper to maintain his lawn
rather than do it himself. Kevin is determined that he can earn more in the hour it would take him
to work on his lawn than he must pay his landscaper. This scenario is an example of which
principle of econmics correct answers Trade can make everyone better off

An overcrowded beach is an example of correct answers tragedy of commons

Competitive firms that earn loss in the short run should correct answers Shut down if P<AVC

For a firm in a perfectly competitive market the price of good is always correct answers Equal to
marginal revenue

What must be given up to obtain an item is called correct answers Opprotunity cost

Moral Hazard Occurs when correct answers An employee lacks an incentive to promote the best
interest of the employer, and the employer cannot observe the actions of the employee

Suppose the US and Mexico both produce semiconductors and auto parts and the us has a
comparative advantage in semiconductors while Mexico has a comparative advantage in auto

, parts. IS the US exports semiconductors to Mexico and imports auto parts from mexico correct
answers Both countries, as a whole will be better off

The most obvious benefit of specialization and trade is that they allow us to correct answers
consumer more goods than we otherwise would be able to consume

A seller in a competitive market can correct answers sell all he wants at the going price, so he
has little reason to charge less

In a market economy, correct answers supply and demand determines prices and prices, in turn,
allocate the economy scarce resources

Which of the following can lead to market failure?
A. Externalities and market power
B. Externalities but not market power
C. Market power but not externalities
D. neither externalities nor market power correct answers Externalities and market power

A competitive market is a market in which correct answers no individual buyer or seller has any
significant impact on the market price

The term tax incidence refers to correct answers the distribution of the tax burden between
buyers and sellers

When asymmetric information affects a relationship between two parties, it is always the case
that correct answers one party is better informed than the other party

Deadweight loss is the correct answers decline in total surplus that results from a tax

An example of a private good would be correct answers a pair of pants

Elascity is correct answers the measures of how much buyers and sellers respond to change in
market conditions

Averaget total costs is equal to correct answers total cost/output

Goods produced abroad and sold domestically are called correct answers imports

Which of the following areas of study describes microeconomics as opposed to macroeconmics?
A. A comparison of alternative tax policies and their respective impacts on the rate of the nations
economic growth
B> the impactt of faster money growth on the rate of inflations
C. the impact of minimum wage laws on employment in the fast food indutry
D. The effect of changes in household saving rates on the growth of national income correct
answers C. the impact of miniumum wage laws on employment in the fast food industry

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