Question

{e}Suppose there are only two individuals in the market for a certain good. Individual A's inverse demand equation is P = 8 – 0.5QD and individual B's inverse demand equation is P = 10 – QD. What is the aggregate demand equation for this market?
A.QD = 14 – 1.5P
B.P = 18 – 1.5QD
C.QD = 12 – 2/3P
D.QD = 26 – 3P

{f}Future consumption is independent of the consumption decisions made today.
A.True
B.False

{g}Pollution is a direct consequence of the profit motive of corporations in capitalist societies.
A.False
B.True

{h}An example of an incentive that can reduce the number of vehicles being driven is ________.
A.a carbon tax
B.an annual vehicle ownership fee
C.an education program that tells people how their driving affects air quality
D.a tax based on the number of kilometres driven

{I}Gasoline, oil, insurance and maintenance reflect the ________ of driving a car.
A.external costs
B.private costs
C.opportunity costs
D.internal costs

Answer 1