Refer to the graph shown. If the government imposed a price ceiling of $4, producers' revenue would:
A. decline.
B. remain unchanged.
C. rise.
D. It cannot be determined.
Answer: A
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All of the following will shift the consumption function EXCEPT
A) a change in income. B) a change in wealth. C) a change in the rate of interest. D) a change in expectations concerning economic conditions.
For an investment to be considered autonomous, it must
A) be negatively related to the interest rate. B) increase as the level of income increases. C) include fixed components. D) be independent of the level of real disposable income.
Which of the following is a necessary condition for price discrimination?
a. The seller must be able to divide the markets according to the different price elasticities of demand. b. It must be difficult for one buyer to resell to another buyer. c. Both a and b. d. Neither a nor b.
If a firm finances a new project using its own funds,
a. the cost is minimal b. the opportunity cost of borrowing has been avoided c. investment funds will be in excess supply d. the financing charges are the measure of the real interest rate e. the interest rate represents the firm's opportunity cost