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my answers to econ mid2

my answers to econ mid2 - Chapter 7 1 Welfare economics is...

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Chapter 7 1. Welfare economics is the study of how a. the allocation of resources affects economic well-being. b. a price ceiling compares to a price floor. c. the government helps poor people. d. a consumer’s optimal choice affects her demand curve. 2. Welfare economics is the study of a. taxes and subsidies. b. how technology is best put to use in the production of goods and services. c. government welfare programs for needy people. d. how the allocation of resources affects economic well-being. 3. Welfare economics is the study of 4. The study of how the allocation of resources affects economic well-being is called 5. An example of positive analysis is studying 6. An example of normative analysis is studying a. how market forces produce equilibrium. b. surpluses and shortages. c. whether equilibrium outcomes are socially desirable. d. income distributions. 7. Which of the Ten Principles of Economics does welfare economics explain more fully? 8. Which of the Ten Principles of Economics does welfare economics explain more fully?
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9. One of the basic principles of economics is that markets are usually a good way to organize economic activity. This principle is explained by the study of Table 7-2 This table refers to five possible buyers' willingness to pay for a case of Vanilla Coke. Buyer Willingness To Pay David $8.50 Laura $7.00 Megan $5.50 Mallory $4.00 Audrey $3.50
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