Questions from Microeconomics

Q: The fumes from dry cleaners can contribute to air pollution. Suppose

The fumes from dry cleaners can contribute to air pollution. Suppose the following graph illustrates the situation in the dry cleaning market. a. Explain how a government can use a tax on dry cleani...

Q: Amazon allows authors who self-publish their e-books to

Amazon allows authors who self-publish their e-books to set the prices they charge. One author was quoted as saying: “I am able to drop prices and, by sheer volume of sales, increase my income.” Was t...

Q: A news story notes that some features of the U.S

A news story notes that some features of the U.S. health care system contribute “to the high cost of medical care by encouraging hospitals and doctors to perform tests and procedures regardless of the...

Q: Suppose the graph on the next page shows Tanzania’s production possibilities frontier

Suppose the graph on the next page shows Tanzania’s production possibilities frontier for cashew nuts and mangoes. Assume that the output per hour of work is 8 bushels of cashew nuts...

Q: To receive a medical license in the United States, a doctor

To receive a medical license in the United States, a doctor must complete a residency program at a hospital. Hospitals are not free to expand their residency programs in a particular medical specialty...

Q: The competitive equilibrium rent in the city of Lowell is currently $

The competitive equilibrium rent in the city of Lowell is currently $1,000 per month. The government decides to enact rent control and establish a price ceiling of $750 per month for apartments. Brief...

Q: Companies that produce toilet paper bleach the paper to make it white

Companies that produce toilet paper bleach the paper to make it white. Some paper plants discharge the bleach into rivers and lakes, causing substantial environmental damage. Suppose the following gra...

Q: The Delaware River Joint Toll Bridge Commission increased the toll from $

The Delaware River Joint Toll Bridge Commission increased the toll from $0.50 to $1.00 on the bridges on Route 22 and Interstate 78 from New Jersey to Pennsylvania. Use the information in the followin...

Q: An opinion column in the Wall Street Journal observes about “defensive

An opinion column in the Wall Street Journal observes about “defensive medicine” that “many physicians maintain that fear of lawsuits significantly affects the practice of medicine, and that reform of...

Q: Why do some consumers tend to favor price controls while others tend

Why do some consumers tend to favor price controls while others tend to oppose them?