The figure above shows the marginal social costs (MSC), marginal private benefits (MB), and marginal social benefits (MSB) of college education in Inland
If Inland's government does not intervene, and the colleges are competitive, the deadweight loss is A) zero.
B) $100 million per year.
C) $200 million per year.
D) $300 million per year.
D
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If rising costs have compelled an increase in the price of football tickets for next season, you could safely assume the college athletic director
A) doesn't know the difference between sunk costs and marginal costs. B) doesn't want fans to become angry or resentful about the price increase. C) isn't setting prices to maximize net revenue. D) really has not raised prices. E) would prefer not to raise prices but has no choice in the matter.
How are Treasury bond prices affected when the interest rate rises?
a. The purchaser of the bond needs to spend less money to obtain a given number of dollars of interest per year, so the price of the bond must decrease. b. The purchaser of the bond needs to spend more money to obtain a given number of dollars of interest per year, so the price of the bond must increase. c. The purchaser of the bond needs to spend more money to obtain a given number of dollars of interest per year, so the price of the bond must decrease. d. The purchaser of the bond needs to spend less money to obtain a given number of dollars of interest per year, so the price of the bond must increase.