A price ceiling is, in essence, an implicit tax on producers and an implicit subsidy to consumers.
Answer the following statement true (T) or false (F)
True
A price ceiling transfers surplus from producers to consumers by lowering the price.
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Suppose the world price of a shirt is $10. If the United States imposes a tariff of $5 a shirt, then the price of a shirt in the
A) world rises to $5. B) United States rises to $15. C) United States falls to $5. D) world rises to $15 E) world falls to $5.
Which of the following is an example of adverse selection?
A) Overgrazing of a common piece of land B) Passengers travelling in a subway without a ticket C) A customer buying a defective appliance from a used goods market D) The generation of a harmful chemical during the production of a good
Refer to Figure 2-8. What is the opportunity cost of 100 dozen roses?
A) 0.8 dozen orchids B) 5 dozen orchids C) 40 dozen orchids D) 80 dozen orchids
Which of the following is an example of a measure of labor productivity?
A) Farm workers produce 30 bushels of wheat per worker per day. B) Autos get 30 gallons to the mile. C) The growth rate of per capita real GDP is 3.5 percent per year. D) Wages increase by 3.5 percent per year for 5 years.