Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
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Question
Chapter 1, Problem 3.5P
To determine
Drawback of statements.
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The following table shows how much utility Taran gets from watching his favorite teams, measured in "utils" (units of satisfaction).
Team
Manchester United
Seattle Kraken
Seattle Mariners.
Seattle Seahawks
Seattle Sounders.
Seattle Storm
Utils
68
81
78
64
72
86
Suppose Taran can only watch one of his favorite teams play. Assuming the cost to watch each team is the same, which team will
Taran choose to watch?
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Please use ideas like concepts of monopolies, Oligopolies and Game Theory and Factor markets for this scenario.
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- An economy produces hot dogs and hamburgers. If a discovery of the remarkable health benefits of hot dogs were to change consumers' preferences, it would..arrow_forwardQuestion 2.2. Henry wants to buy a book. The economic perspective suggests that Henry will buy the book if the book will give him utility. his income is high. the marginal cost of the book is greater than its marginal benefit. the marginal benefit of the book is greater than its marginal costarrow_forwardJoab and his friends used to play a game where they put on a dog's electric fence collar and tried to stand over the electric fence line because, after careful consideration of the costs and benefits, they decided that the benefits of watching their friends get shocked outweighed the costs of being shocked themselves. According to the economic way of thinking, by playing this game, Joab and his friends were O not responding to the incentives they faced. making an irrational choice. making a rational choice. not fully considering the costs and benefits of their decision since this is obviously a mistake for anybody to do.arrow_forward
- The rules of politics are not always the same as the rules of economics. In discussions of setting budgets for government agencies, there is a strategy called “closing the Washington Monument.” When an agency faces the unwelcome prospect of a budget cut, it may decide to close a high-visibility attraction enjoyed by many people (like the Washington Monument). Is this strategy economically efficient? In other words, does it minimize the utility loss from a budget cut? Explain. If this strategy is not economically efficient, what is the incentive to pursue such a strategy?arrow_forwardWhen alice went to a movie theatre last time,she had to choose between a romantic movie and action movie. Eventually she decided to watch the romantic movie. Did alice face any scarcity in this situation?arrow_forwardWhat does behavioral economics have to say about each of the following statements? a. “Nobody is truly charitable—they just give money to show off.” b. “America has a ruthless capitalist system. Considerations of fairness are totally ignored.” c. “Selfish people always get ahead. It’s like nobody even notices!”arrow_forward
- If you buy something, you are never ripped off, at least according to the way economists think. If you are willing to spend the money for something, then it has at least that much utility to you. Think about the following three situations: In this very moment A baseball game in a ballpark that does not allow outside food and drink The end a three-mile hike in the desert when you forgot water In each situation, how much would you be willing to pay for the first bottle of water? Would you buy a second bottle of water? If so, how much would you pay? Discuss how utility changes in different circumstances and with each additional unit you buy.arrow_forwardWhy is market definition important for economic decision making?arrow_forward
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