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My last micro class help questions?

Discuss anything relating to Consumer Law

My last micro class help questions?

Postby sheridan93 » Fri Mar 02, 2012 9:31 am

25) From the point of view of consumer and producer surplus, what problem may be created when a country subsidizes the cost of energy to consumers to help alleviate the burden of higher energy costs?
A.

It hurts the poor and benefits the rich.
B.

It leads to less fuel being used than the amount that maximizes consumer surplus.
C.

It encourages the consumption of too much fuel at the expense of other goods.
D.

It has no effect; consumers gain a surplus, but taxpayers lose the same amount because they must finance the subsidy.


26) Suppose people freely choose to spend 40 percent of their income on health care, but the government decides to tax 40 percent of a person's income to provide the same level of coverage as before. What can be said about deadweight loss in each case?
A.

Taxing income results in deadweight loss, while purchasing health care on one's own does not result in deadweight loss.
B.

Taxing income results in less deadweight loss, because government knows better what health care coverage is good for society.
C.

There is no difference because the goods are purchased in the market in either case.
D.

There is no difference because the total spending remains the same and the health care purchased remains the same.


27) The U.S. textile industry is relatively small because the US imports most of its clothing. A clear result of the importation of clothing is
A.

there is less variety available than there would be without imports
B.

the quality of clothing is lower than it would be without imports
C.

the price of clothing is higher than it would be without imports
D.

the price of clothing is lower than it would be without imports


28) Countries can expect to gain from international trade as long as they
A.

keep production diversified
B.

specialize according to their comparative advantage
C.

produce only those goods for which they have a relatively high opportunity cost
D.

use trade restrictions to reduce competition for domestic producers


29) Which of the following is an example of the law of one price?
A.

Exchange rates tend to have equivalent values. For example, one Italian lire equals one U.S. dollar.
B.

Because people have essentially the same basic needs wherever they live, they tend to buy the same bundle of goods.
C.

Because wages are so much lower in China, eventually all U.S. jobs will be outsourced to China, leaving the US to import all goods at one price.
D.

Because their countries have similar institutions, the price paid for a computer in Germany and the United States are about the same when converted into the same currency.


30) The fact that U.S. managers' salaries are substantially greater than those of comparable managers in Japan may be related to
A.

an increase in the demand for CEOs
B.

an increase in the supply of CEOs
C.

the comparatively greater competitive markets in Japan
D.

the greater number of public goods provided in the United States
sheridan93
 
Posts: 24
Joined: Fri Apr 01, 2011 1:46 am

My last micro class help questions?

Postby karlitis » Fri Mar 02, 2012 9:31 am

25) c. Sorry cant do them all
karlitis
 
Posts: 21
Joined: Fri Apr 01, 2011 5:04 pm


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