A tax on gasoline reduced consumer and producer surplus by 45 million dollars, but it brought in 35 million dollars in tax revenue. What was the deadweight loss created by this tax?
a. 10 million dollars
b. 45 million dollars
c. 80 million dollars
d. 160 million dollars
a. 10 million dollars
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Which of the following is a rationale for development planning?
(a) government failure. (b) market failure. (c) failure of consumers to understand their preferences. (d) all of the above are rationales for development planning. (e) none of the above are rationales for development planning.
It has been shown that when offered higher wages, women will work more hours. This is because
a. women tend to work more hours than men at any wage rate. b. the substitution effect is more dominant for women. c. the income effect is more dominant for women. d. women are more productive than men at higher wages.
People cope with uncertainty about the future:
A. in very similar ways, regardless of the situation. B. in many ways, such as buying insurance. C. exactly the same way, regardless of the situation. D. by always avoiding it.
Monopolists are said to be allocatively inefficient because:
A. at the profit-maximizing output, the marginal benefit to society from increasing output is greater than the marginal cost to society. B. they produce where MR > MC. C. they produce only the type of product they desire and do not consider the consumer. D. at the profit-maximizing output, price is greater than AVC.