The Hawaiian island of Lana'i is privately owned by Castle & Cooke and for generations most of its land was used to grow pineapples. Now, many of the pineapple fields have been replaced by tourist accommodations, including a pair of world-class hotels
and a top rated golf course. What would an economist say about this change in land-use patterns?
A) While growing pineapples used the island's land more efficiently, tourism provides utility to the largest number of people.
B) Economic rent has allocated the island's resources to their highest valued use: tourism.
C) Agriculture is still the land's highest-valued and most efficient use, but tourism earns more profits for Castle & Cooke.
D) To find the land's economic rent, add the price per acre that land on Lana'i would be worth if used to grow pineapples to the value per acre when used for a golf course.
Answer: B
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Which of the following statements is correct?
a. Strategic situations are more likely to arise when the number of decision-makers is very large rather than very small. b. Strategic situations are more likely to arise in monopolistically competitive markets than in oligopolistic markets. c. Game theory is useful in understanding certain business decisions, but it is not really applicable to ordinary games such as chess or tic-tac-toe. d. Game theory is not necessary for understanding competitive or monopoly markets.
According to the table shown, which year is most likely being used for the base year?
A. 2010
B. 2011
C. 2012
D. 2013