If the union wants to follow the strategy of maximizing member's income, wages should be set
A) above the market clearing wage rate.
B) such that all that wanted to work could work.
C) at the market clearing wage rate.
D) at the point at which the price elasticity of demand equals 1.
Answer: D
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There are two consumers in the market, Jack and Jane. Each have some coffee and candies (coffee on the horizontal axis). Jack's MRS of candies for coffee is 3. Jane's MRS of candies for coffee is 3
Which one of the following statements is incorrect? A) This allocation is on the contract curve. B) This can be a competitive equilibrium. C) This allocation is Pareto efficient. D) We can reallocate goods so as to make one person better off without harming another.
To say that a price floor is binding is to say that the price floor
a. results in a shortage. b. is set below the equilibrium price. c. causes quantity supplied to exceed quantity demanded. d. All of the above are correct.