A market has four individuals, each considering buying a grill for his backyard. Assume that grills come in only one size and model. Abe considers himself a grill-master, and finds a grill a necessity, so he is willing to pay $400 for a grill. Butch is a meat-lover, honing his grilling skills, and is willing to pay $350 for a grill. Collin just met the girl of his dreams, and she loves a good grilled steak, so in his effort to impress her he is willing to pay $320 for a grill. Daniel loves grilled shrimp and thinks it might be cheaper in the long run if he buys a grill instead of eating out every time he wants grilled shrimp, so he is willing to pay $200 for a grill.
If the market price of grills is $350, given the scenario described, total consumer surplus would be:
A. $750.
B. $400.
C. $50.
D. $870.
C. $50.
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A statistical tool used to measure inequality is
A) the absolute poverty rate. B) the relative poverty rate. C) the Lorenz curve. D) the Gini coefficient.
The legislation that effectively prohibited banks from branching across state lines and forced all national banks to conform to the branching regulations in the state in which they reside is the
A) McFadden Act. B) National Bank Act. C) Glass-Steagall Act. D) Garn-St.Germain Act.
Grace maximizes her utility by consuming both gourmet cookies and ice cream. If the price of a dozen cookies is three times that of a pint of ice cream, we would expect that: a. the total utility of a dozen cookies is three times that of a pint of ice cream
b. the total utility of a dozen cookies is one-third that of a pint of ice cream. c. the marginal utility of the last dozen cookies is three times that of the last pint of ice cream. d. the marginal utility of the last dozen cookies is one-third times that of the last pint of ice cream.
If the average propensity to consume is initially 0.85, the marginal propensity to consume is 0.75, and real disposable income increases by $1000, the value of saving
A. increases by $250. B. decreases by $250. C. increases by $150. D. decreases by $150.