When a nation imports a good, its ________ surplus decreases and its ________ surplus increases
A) consumer; producer
B) consumer; consumer
C) producer; producer
D) producer; consumer
E) total; consumer
D
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Do firms in perfect competition advertise their products? Why or why not?
What will be an ideal response?
In this book, An inquiry into the Nature and Causes of the Wealth of Nations, Adam Smith described a visit he made to a
A) car factory. B) Pin factory. C) Washing Machine Factory. D) farm.
Explain why there is an incentive to cheat in collusive oligopoly. How does such behavior threaten collusive oligopoly over time?
What will be an ideal response?
With reference to the graph above, if the intended aim of the price ceiling set at $6 was a net increase in the well-being of consumers, then positive analysis would conclude:
A. the policy was effective, since surplus gained by consumers through lower prices is greater than the surplus they lost through deadweight loss.
B. the policy was ineffective, since surplus gained by consumers through lower prices is less than the surplus they lost through deadweight loss.
C. the policy was effective, since surplus lost by producers through lower prices is less than the surplus gained by consumers through lower prices.
D. the policy was ineffective, since the amount of deadweight loss is greater than the surplus gained by consumers from lower prices.