Chapter 1 |10 Questions| With Correct Answers.

The market failure associated with cable TV arises from the _____________ the cable TV firm, which allows the firm to have a substantial influence on market prices. {Ans: market power of}Which of the following describe some of the trade-offs faced by a professor deciding how much time to spend preparing for class? {Ans: - The more he prepares, the better his lectures, but the less he prepares, the more free time he can enjoy doing something else. - The better the lecture, the better his chances of tenure, but time spent preparing the lecture decreases the time he has available to work on research.}Which of the following describe some of the trade-offs faced by a recent college graduate deciding whether to go to graduate school? {Ans: - If she goes to graduate school, she won't be able to spend as much time with her family. - Taking out more student loans means she may not able to purchase the new car she needs. - Graduate school means fewer years of on-the-job experience.}Which of the following describe some of the trade-offs faced by a company president deciding whether to open a new factory? {Ans: - The firm