On a graph, high correlation between the variable measured along the x-axis and the variable measured along the y-axis
A) means that changes in the variable measured along the x-axis must cause changes in the variable measured along the y-axis.
B) means that changes in the variable measured along the y-axis must cause changes in the variable measured along the x-axis.
C) means that changes in either variable must cause changes in the other variable.
D) does NOT mean that a change in the variable measured along the x-axis must cause a change in the variable measured along the y-axis.
Question 2
The table above gives the marginal social cost (which equals the price), marginal private benefit, and marginal social benefit of students attending Diablo Valley College (DVC) in Concord, California.
a. When 4,500 students attend DVC, what does the marginal external benefit equal?
b. If the market is competitive and left without government intervention, what is the quantity of students that will attend DVC and what will be the price of a course?
c. What is the efficient quantity of students attending DVC?
d. If the government can set the price per course, in order to have the efficient quantity of students attending DVC, what should the government set as the price?
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