Question

30. What can a student in college do to increase demand for his or her labor services?

a. Nothing, there is no way individuals can affect demand for their own services.

b .He or she should quit school and look for a job.

c. He or she should move to a state with a large population.

d. He or she should increase his or her marginal product in producing valuable goods or services.

31. Firms in oligopoly can achieve an economic profit

a. always in the long run.

b. if they cooperate.

c. only if the demand for their products is inelastic.

d. only if the demand for their products is elastic.

32. Which of the following statements is correct?

a.    The distribution of wealth is not the best measure of true inequality.

b.    Inequality using annual income overstates actual lifetime inequality.

c.    The inequality of annual incomes is less than the inequality of income.

d.    All of the above statements are correct.

33. If tuition at a college is $30,000 and the external benefit of graduating from this college is $10,000, then

a.    in the absence of any government intervention, the number of students graduating is less than the efficient number.

b.    the government could increase the number of graduates by giving the college a $10,000 subsidy per student.

c.    the government could increase the number of graduates by giving the students $10,000 vouchers.

d.    All of the above answers are correct.

34. Tax incidence is the

a.    dollar amount of a tax, expressed as a percentage of the purchase price.

b.    dollar amount of a tax per unit sold.

c.    division of a tax burden between the buyer and seller.

d.    amount of revenue collected by government on a specific good.

Answer 1

30) correct choice is option d. Marginal product of labour is the part of demand function of labour according to which the wage rate is determined. An increase in the marginal product of labour increases the wage rate if price of the good produced remains unchanged

31) option A is correct. This is because in the long run the oligopoly firms are able to restrict entry of potential rivals thereby enjoy long and profits

32) option B is correct. This is because different households have different stages of life cycles so that there lifetime inequality is not measurable using annual income

33) option d is correct

34) option C is correct.