Suppose that elementary education creates a positive externality. If the government does not subsidize education, then

The entry of new firms into a competitive market will

Selling a good at a price determined by the intersection of the demand curve and the marginal cost curve is consistent with the (i) socially-optimal level of output. (ii) market solution for profit-maximizing competitive firms. (iii) market solution for a profit-maximizing monopoly.

Roger owns a small health store that sells vitamins in a perfectly competitive market. If vitamins sell for $12 per bottle and the average total cost per bottle is $12.50 at the profit-maximizing output level, then in the long run

A movement along the demand curve might be caused by a change in

If a increase in income decreases the demand for a good, then the good is a(n)

Figure 17-2. Two companies, Acme and Pinnacle, each decide whether to produce a good quality product or a poor quality product. In the figure, the dollar amounts are payoffs and they represent annual profits for the two companies. Refer to Figure 17-2. The dominant strategy for Acme is to

Michael values a stainless steel refrigerator for his new house at $3,500, but he succeeds in buying one for $3,000. Michael’s willingness to pay is

A tradeoff exists between a clean environment and a higher level of income in that

Figure 2-13 Refer to Figure 2-13. Which points are not currently attainable but could become achievable for this economy if there is an improvement in technology?