According to the graph shown, consumer surplus is:
A. the area under the supply curve and above the price.
B. the area above the supply curve and below the price.
C. the area under the demand curve and above the market price.
D. the area above the demand curve and below the price.
C. the area under the demand curve and above the market price.
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Use the data in the table above and suppose that labor is the only variable factor of production. When 122 dozen donuts are produced at Decent Donuts, the MC curve
A) has a positive slope. B) shows the effect of increasing marginal returns. C) Both answers A and B are correct. D) Neither answer A nor B is correct.
Thrift institutions that specialize in mortgage investments and borrow short and lend long are risky
Indicate whether the statement is true or false
The supply curve is believed to bend backward at high wage rates because
a. income effects outweigh substitution effects. b. substitution effects outweigh income effects. c. the income and substitution effects work together to create the backward bend. d. leisure time is less attractive.
The Tobit model relies crucially on normality and heteroskedasticity in the underlying latent variable model.
Answer the following statement true (T) or false (F)