Refer to Figure 4-10. Suppose that instead of a price ceiling, the government imposed a price floor of R1. What is the area representing consumer surplus after the imposition of the price floor?
A) A + B + D B) B + C + D + E C) A D) C + E
C
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A monopoly is the only seller of a product
A. without a wellminusdefined demand curve. B. with many substitutes. C. with a perfectly inelastic demand. D. without a close substitute.
Evan knows his GPA would skyrocket if he could break his horrible habit of procrastinating. An example of a commitment device Evan could use would be:
A. to allow himself one hour of leisure for every half-hour of studying he does each day. B. to exercise before studying in order to be refreshed. C. to pay a student to meet him each afternoon for 2 hours in the library to ensure he studies every day. D. All of these are commitment devices.
Which of the following is not a consideration when attempting to eliminate a free rider problem or tragedy of the commons problem?
A. The social costs must be realized by the individual. B. Something must be done to alter individuals' trade-offs. C. Market participants must internalize the value of the externality. D. Firms must be forced to provide the good or service at a price that is below profit maximizing price.
To calculate GDP using the income approach, add:
a. indirect business taxes and Social Security taxes. b. capital depreciation and Social Security taxes. c. indirect business taxes and personal taxes. d. indirect business taxes and depreciation. e. compensation of employees, rents, profits, net interest, indirect business taxes, and depreciation.