Changes

==Assignment==

==Assignment==

Read and, if necessary, reread the above lecture.  Then answer six out of the following seven questions:

Read and, if necessary, reread the above lecture.  Then answer five out of the following six questions, and then take the online quiz:

1. Define, in your own words, economic “efficiency”.  Use it in an example sentence.

1. Define, in your own words, economic “efficiency”.  Use it in an example sentence.

4.  Suppose your annual income increases from $20,000 to $25,000.  Suppose your demand for steak increases by 10% and your demand for fast food hamburgers decreases by 5%.  Which type of goods are steak, and which type are hamburgers?

4.  Suppose your annual income increases from $20,000 to $25,000.  Suppose your demand for steak increases by 10% and your demand for fast food hamburgers decreases by 5%.  Which type of goods are steak, and which type are hamburgers?

5.  What is the basic assumption of the Coase theorem, and why is that assumption so important to the result of the theorem?

5.  What does an owner do when his marginal revenue exceeds his marginal cost? Explain.

6.  What does an owner do when his marginal revenue exceeds his marginal cost?  Explain.

6.  What does the Coase theorem say about the desirability, and the effect, of government regulations that increase transaction costs?

 

7.  What does the Coase theorem say about the desirability, and the effect, of government regulations that increase transaction costs?

===Honors===

===Honors===