A government-imposed price floor has what effect on efficiency?
A. Consumer surplus increases.
B. There is little dead weight loss.
C. Consumer and producer surplus increases.
D. Producer surplus increases.
Answer: D
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An increase in the minimum wage for unskilled labor tends to
A) generate unemployment among unskilled laborers. B) increase the quantity supplied of unskilled laborers. C) decrease the quantity demanded for unskilled laborers. D) encourage employers to seek substitutes for unskilled labor. E) accomplish all of the above.
The product life cycle model says that comparative advantage in manufactured goods may move from one country to another as a product becomes more standardized
Indicate whether the statement is true or false
Persistence is
A) the tendency for declines in economic activity to be followed by further declines, and for growth in economic activity to be followed by more growth. B) the idea that the standard pattern of contraction—trough—expansion—peak occurs again and again in industrial economies. C) the tendency of many economic variables to move together in a predictable way over the business cycle. D) the idea that peaks and troughs of the business cycle occur at regular intervals.
All taxes impose an excess burden.
A. True B. False C. Uncertain