In 1949,Sycamore,Illinois Built a Hospital for About $500,000

question 42

Multiple Choice

In 1949,Sycamore,Illinois built a hospital for about $500,000.In 1987,the county restored the courthouse for about $1.7 million.A price index for nonresidential construction was 24 in 1949,108 in 1987,and 126.5 in 2000.According to these numbers,the hospital cost about

• A)$2.1 million in 2000 dollars,which is less than the cost of the courthouse restoration in 2000 dollars.
• B)$2.1 million in 2000 dollars,which is more than the cost of the courthouse restoration in 2000 dollars.
• C)$2.6 million in 2000 dollars,which is less than the cost of the courthouse restoration in 2000 dollars.
• D)$2.6 million in 2000 dollars,which is more than the cost of the courthouse restoration in 2000 dollars.

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Definitions:

Monopolistically Competitive

Refers to a market structure where many firms sell products that are similar but not identical, allowing for some degree of product differentiation and market power for each firm.

Price Control

Government-imposed limits on the prices that can be charged for goods and services in the market to control inflation and stabilize the economy.

Monopolistically Competitive

A market structure where many firms sell products that are similar but not identical, allowing for competition based on quality, price, and branding.

Marginal Cost

The increase or decrease in the total cost incurred by producing one additional unit of a product or service.