Refer to Figure 7-4. When the price falls from P1 to P2, which area represents the increase in consumer surplus to new buyers entering the market?
a. BDF
b. BCGD
c. AFG
d. ABC
b. BCGD
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If the price of Pepsi decreases, all else held constant, then we'd expect to see a consequent shift of the demand curve for
A. Pepsi to the right. B. Coke to the right. C. Coke to the left. D. Pepsi to the left.
Which of the following is characteristic of a perfectly competitive firm's demand curve?
A. Its elasticity coefficient is 1 at all levels of output. B. Average revenue is less than price. C. It's the same as the market demand curve. D. Price and marginal revenue are equal at all levels of output.
Employing a general equilibrium approach, describe the effect of a new law that prohibits steel imports
What will be an ideal response?
The above figure shows the market for steel ingots. If the market is competitive, then the competitive market level of output is
A) 100 units. B) 150 units. C) 50 units. D) 300 units.