On a graph, consumer surplus is the area above the equilibrium price and below the demand curve.
Answer the following statement true (T) or false (F)
True
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Explain why after, say Norway unilaterally pegs the krone to the euro, domestic money market disturbances will no longer affect domestic output despite the continuation of float-rate regime against non-euro currencies
What will be an ideal response?
The vicious circle of poverty refers to a condition where:
a. c and d. b. c and e. c. people are poor because they cannot invest in capital goods and they cannot invest in capital goods because they are poor. d. people cannot invest in capital goods because they are poor and they are poor because they cannot invest in capital goods. e. poverty is relative and poor people remain poor because the wealthy grow wealthier.
For an inferior good, the income effect
a. is zero b. at least partially offsets the substitution effect c. operates to increase the quantity demanded d. helps explain why the demand curve slopes upward e. does not exist
When all perfectly competitive firms in a market or all monopolistically competitive firms in a market make zero economic profit,
a. no firms will enter the market b. all firms will exit the market c. a monopolist will take over the market d. the market demand shifts to the left e. the price of the good produced will increase in the long run