Many nations are consistently accused of enjoying the benefits of membership in the United Nations, yet they provide few or no funds to support the organization. This is an example of
A) the principle of rival consumption.
B) the free-rider problem.
C) the negative externality problem.
D) the property rights problem.
Answer: B
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A labor market is divided into two segments. All workers have the same qualifications and find jobs in either segment equally attractive. Initially, both segments are in competitive equilibrium. Then the development of worker prejudice that reduces the hiring of minorities in one segment can lead to a
a. permanent increase in labor supply in the discriminating segment b. permanent increase in labor supply in the nondiscriminating sector c. temporary change in the composition of labor in both segments which will revert back to an equal distribution of workers eventually d. temporary increase in labor supply in both segments e. temporary change in wage rates in both segments
Exhibit 7-13 Price and cost per unit curves
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In Exhibit 7-13, if the price is P3, the firm will
A. produce Q3 and earn an economic profit. B. produce Q3 and incur a loss in the short run. C. produce Q3 and earn zero economic profit. D. decide not to produce any output to minimize the loss.