Figure 3-16

Refer to . When the price is P₁, producer surplus is

a.

A.

b.

C.

c.

A + B.

d.

C + D.

Economics

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If demand for a given good is perfectly elastic, it follows that

a. as price changes, quantity demanded does not change. b. as price changes, quantity demanded changes by a larger percentage. c. as price changes only a small percentage, quantity demanded falls to zero. d. as income changes only a small percentage, quantity demanded changes by a very large percentage. e. none of the above

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The burden of a tax is placed entirely on the buyers of a good when the demand for the good is _____

a. perfectly inelastic b. perfectly elastic c. unit elastic d. relatively elastic

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An appreciation of the U.S. dollar

a. makes our exports less expensive in terms of foreign currency and imports cheaper in terms of the dollar, decreasing net exports.

b. makes our exports less expensive in terms of foreign currency and imports cheaper in terms of the dollar, increasing net exports.

c. makes our exports more expensive in terms of foreign currency and imports cheaper in terms of the dollar, decreasing net exports.

d. makes our exports more expensive in terms of foreign currency and imports cheaper in terms of the dollar, increasing net exports.

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A futures contract is essentially the same thing as a forward contract.

a. true b. false

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