Which of the following is the largest single component of the market basket used to compute the consumer price index (CPI)?

If a positive externality were present in a market, the social benefit curve would be:

A. the same as the private demand curve. B. above the private demand curve. C. below the private demand curve. D. Cannot say without more information.

When the price of pens went from $1 to $1.50, the quantity demanded of pencils changed from 50 to 75 a day. The cross-price elasticity of demand for pens (using the initial value formula) is:

A. 0.8. B. 0.4. C. 0.2. D. It cannot be determined from the information provided.