Which of the following statements describes a surplus?
a. A surplus is the same as an excess demand.
b. A surplus occurs when the price is above equilibrium price.
c. A surplus occurs when the price is below equilibrium price.
d. A surplus occurs when the quantity demanded exceeds the quantity supplied.
b. A surplus occurs when the price is above equilibrium price.
At any above-equilibrium price, the quantity supplied exceeds the quantity demanded. We call this an excess supply or a surplus.
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Mary Jane is willing to babysit for $6 an hour. Her neighbor has asked her to babysit for $8 an hour. Assuming Mary Jane accepts the offer:
A. her accounting profit will be $8 per hour, and her economic profit will be $0 per hour. B. her economic rent will be $2 per hour. C. her consumer surplus will be $2 per hour. D. her economic profit will be $8 per hour.
What are the two critical measures of a nation's economic health?
A) sales and taxes B) wages and raises C) income and spending D) production and income
Liz's marginal utility for two different goods is determined by
A) her average utility for the two goods. B) how much benefit she gets from another unit of each of those goods. C) summing her total utility from consumption of each good and then dividing by two. D) All of the above answers are correct.
The belief that interest rates are the critical policy lever is associated with
A. Monetarists. B. New classical economists. C. Supply-siders. D. Modern Keynesians.