Exhibit 3A-2 Comparison of Market Efficiency and Deadweight Loss
As shown in Exhibit 3A-2, if the quantity supplied of good X per year is Q1, the result is a deadweight loss represented by area:
A. BEG.
B. CBEFD.
C. EGH.
D. BEF.
Answer: D
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Money demand is given by Md/P = 1000 + .2Y - 1000i. Given that P = 200, Y = 2000, and i = .10, real money demand is equal to
A) 1300. B) 1500. C) 260,000. D) 300,000.
Labor productivity in the United States was 5.4 times higher in the United States than in China in 2010. A key reason that labor productivity is higher in the United States is because the United States
A) has a higher growth rate, based on GDP per capita, than China. B) has a higher life expectancy and higher birth rate than China. C) devotes more resources than China to developing new technology and accumulating human capital. D) devotes more resources than China to developing export markets to boost its real GDP and income.
Consider the same monopoly situation as in the previous question. The monopoly price is
a. 8 b. 46 c. 54 d. 92
When a tax is imposed on buyers, consumer surplus decreases but producer surplus increases
a. True b. False Indicate whether the statement is true or false