Which of the following statements about price controls is true?
A. A price ceiling causes a shortage if the ceiling price is above the equilibrium price
B. A price floor causes a surplus if the price floor is below the equilibrium price
C. A price ceiling causes an increase in demand if the ceiling price is set below the equilibrium price
D. A price ceiling causes a decrease in demand if the price floor is set above the equilibrium price
E. Price ceilings and price floors result in a misallocation of resources
E. Price ceilings and price floors result in a misallocation of resources
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Adverse selection occurs when a sales offer attracts the kinds of customers that the seller does not want
Indicate whether the statement is true or false
The U.S. Federal Reserve
A) has complete independence from the U.S. government. B) acts within the boundaries established by Congress and the president, but has flexibility in meeting the goals of monetary policy. C) is a government agency run by the Treasury Department and under the strict control of Congress. D) is run by elected officials but is only subject to oversight by the U.S. president.
According to the graph shown, if Q2 units are being produced, this monopolist:
This graph shows the cost and revenue curves faced by a monopoly.
A. is earning negative economic profits.
B. is earning positive economic profits.
C. is earning zero economic profits.
D. may be earning zero accounting profits.
A barber shop produces 192 haircuts a day. Each barber in the shop works 8 hours per day and produces the same number of haircuts per hour. If the shop's productivity is 2 haircuts per hour of labor, then how many barbers does the shop employ?
a. 8 b. 12 c. 16 d. None of the above is correct.