A local street festival that previously sold bracelets in exchange for unlimited alcohol consumption is now concerned about the overconsumption of alcohol. If they switch to selling tickets per drink, will overall consumption at next year's festival decrease?
A. No, because the marginal cost per extra beer will decrease for consumers.
B. No, because the marginal cost per extra beer will increase for consumers.
C. Yes, because the marginal cost per extra beer will increase for consumers.
D. Yes, because the marginal benefit per extra beer will increase for consumers.
C. Yes, because the marginal cost per extra beer will increase for consumers.
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If we wanted to prove that macaroni is an inferior good, we would test the __________ of macaroni and get a __________
a. cross-price elasticity; negative number b. income elasticity; number less than 1 c. income elasticity; positive number d. price elasticity of demand; number greater than negative 1 e. income elasticity; negative number
The marginal propensity to consume is always
a. greater than 1 b. between 0 and 1 c. less than 0 d. between 0 and -1 e. between 0 and 0.6