The total amount of consumer surplus and producer surplus is at its maximum when

A) consumers and producers are allowed to trade at the market clearing price.
B) the government imposes a price floor that is higher than the market clearing price.
C) the government imposes a price ceiling that is lower than the market clearing price.
D) free market exchanges do not exist.


Answer: A

Economics

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The short run is

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A firm that is a monopsonist in the labor market and a monopolist in the product market will hire labor to the point at which

A) MFC = MRPm. B) a perfectly elastic labor supply = MRP. C) a perfectly inelastic labor supply = perfectly inelastic labor demand. D) where supply of labor = demand for labor.

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Policies designed to affect the quantity of money are

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