What are the private costs of driving an automobile? What are the external costs?
What will be an ideal response?
The private costs include gas, maintenance, repair, depreciation, and insurance. External costs include the costs associated with air pollution, which include costs to clean cars and paint houses more often, increased health care costs, and the disutility of the air pollution.
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What does a "most-favored-nation (MFN)" status mean?
What will be an ideal response?
Lynn owns Dust Bunnies, a cleaning company. In one week, she is able to clean 9 houses. If she hires an employee, together they are able to clean 15 houses per week
If Lynn charges $100 to clean a house, and she pays her employee $400 a week, should she hire this employee? A) Yes, because the value of marginal product of the worker is less than the wage. B) Yes, because the value of marginal product of the worker is greater than the wage. C) No, because the value of marginal product of the worker is greater than the wage. D) No, because the value of marginal product of the worker is less than the wage.