Economists claim that measuring society's welfare as CS + PS
A) is inappropriate since ultimately everyone is a consumer.
B) is valid only when the same person could be either a consumer or a producer.
C) treats the gains to consumers and producers equally.
D) is not commonly accepted.
C
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Suppose milk and cereal are compliments and the demand for milk is Qdm = 40 - 6Pm - 2Pc, where Qdm stands for millions of gallons of milk demanded, Pm stands for the price of milk and Pc stands for the price of cereal. The supply of milk is Qsm = 6Pm - 8, where Qsm stands for millions of gallons of milk supplied. The demand and supply of cereal are Qdc = 90 - 5Pc - Pm and Qsc = 5Pc - 10, respectively, where Qdc stands for millions of boxes of cereal demanded and Qsc stands for millions of boxes of cereal supplied. What is the general equilibrium price for cereal?
A. $9.76 B. $6.10 C. $0.00 D. $11.25
Lately, the ratio of debt to GDP has been
a. rising at a small rate. b. rising steadily. c. falling modestly. d. staying constant.
A public good is
A. a good deed done by someone who refuses payment. B. something produced and sold by the government, for example, electricity provided by a government authority. C. something whose consumption by one person does not prevent its consumption by other people. D. something that is good for a country, but not necessarily for private individuals.
When the Fed purchases government securities, it:
a. has no effect on either the money supply or the discount rate. b. uses discounting operations to influence margin requirements. c. increases banks' reserves and makes possible an increase in the money supply. d. decreases banks' reserves and makes possible a decrease in the money supply. e. automatically raises the discount rate.