Total surplus is represented by the area
a. under the demand curve and above the price.
b. above the supply curve and up to the price.
c. under the supply curve and up to the price.
d. between the demand and supply curves up to the point of equilibrium.
d
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Suppose the currency drain ratio is 33.33 percent and the desired reserve ratio is 10 percent. The money multiplier equals
A) 3.00. B) 3.08. C) 2.50. D) 6.67. E) 4.27.
Refer to the above figure. If a price floor of $3 was set
A) the quantity sold would be 80 units. B) there would be a surplus of 40 units. C) there would be a shortage of 40 units. D) there would be a shortage of 20 units.
What do economists call the difference between the most an individual is willing to pay for an item and what the individual actually has to pay?
a. price elasticity b. consumer surplus c. indifference curve d. payment terms
You own a building that has four possible uses: a cafe, a craft store, a hardware store, and a bookstore. The value of the building in each use is $2,000; $3,000; $4,000; and $5,000, respectively. You decide to open a hardware store. The opportunity cost of using this building for a hardware store is
A. $5,000, the value if you rented the building to someone else to use as a bookstore. B. $10,000, the sum of the values if the building is used for a cafe, a craft store, or a bookstore. C. $2,000, the value if the building is used as a cafe. D. $3,000, the value if the building is used as a craft store.