38. Suppose an economy contains only 4 consumers. If each of these consumers is willing to purchase 2 TVs when the price of a TV is $400, then: 1.The market demand curve is a vertical line going straight up from the 2 TV mark on the horizontal axis. 2.The market quantity of TV’s demanded when price is $400 is 8.3.The market quantity of TV’s demanded when price is $400 is 16.4.The market demand curve is a horizontal line going straight to the right from the $400 mark on the vertical axis. 5.The market equilibrium price of TVs will be $400.
39. From an economic efficiency point of view, government information campaigns designed to educate consumers about the dangers of smoking and Pigovian taxes on cigarette purchases are a better way to reduce smoking than smoking bans because:
40. In economics, the concept of the “invisible hand” refers to:
End of Exam