An argument against price floors is:
A. non-price rationing must occur, and can lead to consumers waiting in line.
B. the cost to taxpayers if the government buys all surplus.
C. producers will reduce the quality of the goods they sell.
D. they transfer surplus from producers to consumers.
B. the cost to taxpayers if the government buys all surplus.
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With a tax of $4,000 on $24,000 taxable income, the average tax rate is
A. 16.67%. B. 23.45%. C. 20%. D. 25%.
Suppose the quantity demanded is 5 units when the price is $1.00. If the price rises to $2.00, the quantity demanded falls to 3 units. The price elasticity of demand is
A) 0.5. B) 0.75. C) 1.33. D) 2.00.
When General Motors pays an outside vendor for auto parts, this is an external cost.
Answer the following statement true (T) or false (F)
A period of sustained decline in output in an economy is known as a(n) _____
a. expansion b. stagnation c. peak d. trough e. contraction