Three basic decisions must be made by all economies. What are they?
A. How much will be produced, when it will be produced, and how much it will cost.
B. What the price of each good will be, who will produce each good, and who will consume each good.
C. What will be produced, how goods will be produced, and for whom goods will be produced.
D. How the opportunity cost principle will be applied, if and how the law of comparative advantage will be utilized, and whether the production possibilities constraint will apply.
Answer: C
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Ticket scalpers at the NCAA basketball tournament last year charged prices high above the printed ticket price. This observation is evidence of
A) a surplus at printed ticket prices. B) a shortage at printed ticket prices. C) the tournament not being televised. D) the tournament getting too much television exposure.
In an unregulated, competitive market consumer surplus exists because some
A) sellers are willing to take a lower price than the equilibrium price. B) consumers are willing to pay more than the equilibrium price. C) sellers will only sell at prices above equilibrium price (or actual price). D) consumers are willing to make purchases only if the price is below the actual price.