Answer the following questions true (T) or false (F)
1. Consumer surplus is the difference between the highest price someone is willing to pay for a product and the price he actually pays for the product.
2. Producer surplus is the difference between the lowest price a firm is willing to accept for a product and the price it actually receives for the product.
3. The total amount of consumer surplus in a market is equal to the area below the demand curve.
1. TRUE
2. TRUE
3. FALSE
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In emerging market countries, the deterioration in bank's balance sheets has more ________ effects on lending and economic activity than in advanced countries
A) negative B) positive C) affirming D) advancing
Which of the following is true?
a. All types of environmental problems can be solved merely by the enforcement of individual property rights. b. Environmental regulation cannot improve environmental quality. c. Income levels exert little impact on the demand for environmental quality. d. Markets often result in outcomes that are inefficient when it is difficult to assign and enforce property rights.
A tax loophole is
A. an illegal method by which individuals or corporations avoid paying the taxes they legally owe. B. a provision in the tax code that allows individuals or corporations to reduce their tax burdens legally by meeting certain conditions. C. a tax surcharge on incomes within certain ranges. D. a provision in the tax code that allows individuals or corporations to shift the economic incidence of a particular tax on to someone else.
A pollution tax will:
A. always be paid entirely by producers. B. not change the price buyers pay for a good. C. be shared between buyers and sellers. D. always be paid entirely by buyers in the form of a price increase equal to the amount of the tax.