Scenario 10-1 The Demand Curve for Gasoline Slopes Downward and the Supply

question 112

Multiple Choice

Scenario 10-1
The demand curve for gasoline slopes downward and the supply curve for gasoline slopes upward. The production of the 400th gallon of gasoline entails the following:
a private cost of $2.83;
a social cost of $3.12;
a value to consumers of $3.23.
-Refer to Scenario 10-1. From the given information, it is apparent that

• A)the production of gasoline involves a negative externality, so the market will produce a smaller quantity of gasoline than is socially desirable.
• B)the production of gasoline involves a negative externality, so the market will produce a larger quantity of gasoline than is socially desirable.
• C)the production of gasoline involves a positive externality, so the market will produce a smaller quantity of gasoline than is socially desirable.
• D)the production of gasoline involves a positive externality, so the market will produce a larger quantity of gasoline than is socially desirable.

Understand the concept of difference threshold and its application in sensory perception.

Recognize the influence of perceptual set and context effects on sensory interpretation.

Explain the phenomenon of sensory adaptation and its effects on perception.

Describe the principles of signal detection and how they relate to sensory processing.

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Definitions:

Confirmation Bias

A tendency to seek only information consistent with one’s hypothesis.

Information

Data or knowledge communicated or received concerning a particular fact, subject, or event.

Formal Reasoning

A cognitive process involving the use of logical operations or established principles to arrive at conclusions, often associated with higher-order thinking and problem-solving.

Everyday Reasoning

Mundane reasoning that differs from formal reasoning in its use of implicit premises, multiple solutions, personal relevance, and possible emotional involvement.