Willingness to pay measures
A) the maximum price a buyer is willing to pay for a product minus the amount the buyer actually pays for it.
B) the amount a seller actually receives for a good minus the minimum amount the seller is willing to accept for the good.
C) the maximum price that a buyer is willing to pay for a good or service.
D) the maximum price a buyer is willing to pay minus the minimum price a seller is willing to accept.
Answer: C
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If two consumption points are not on the same indifference curve, then one point is ________
A) a substitute for the other point B) unaffordable and the other is affordable C) preferred to the other D) more expensive than the other
In the long-run equilibrium in monopolistic competition, price equals marginal cost
Indicate whether the statement is true or false
Everything else held constant, if aggregate output is to the left of the LM curve, then there is an excess ________ of money which will cause the interest rate to ________
A) supply; fall B) supply; rise C) demand; fall D) demand; rise
When drawn against the real interest rate, the output supply curve is upward sloping because labor supply is
A) increasing in the real interest rate and labor demand is independent of the real interest rate. B) decreasing in the real interest rate and labor demand is independent of the real interest rate. C) independent of the real interest rate and labor demand is increasing in the real interest rate. D) independent of the real interest rate and labor demand is decreasing in the real interest rate.