1. Suppose seven people are trying to decide whether to get a pizza with pepperoni, a pizza with sausage and pepperoni, or a pizza with everything on it. Four people want everything, one wants pepperoni and sausage, and two want pepperoni only. Assume that each person prefers a pizza closer to his or her first choice to a pizza that is unlike the first choice. What is the preference of the median voter? Which pizza will be selected if the majority rules?
2. What dilemma faces regulators trying to regulate natural monopolies?
3. Distinguish among private goods, public goods, natural monopoly, and open-access goods.
4. Political corruption is epidemic in Russia today. What effect does this have on the Russian economy? Compare and contrast bureaus and business firms.
5. How does social regulation differ from economic regulation?
6. Additional Question: Answer in as many words as it takes to answer – Has airline deregulation been a success? Be sure to take into account the accessibility and flight amenities, as well as price. What, if any, effects do you think rising fuel costs will have on airline regulation/deregulation?