To help pay for the cost of sport related injuries, the government imposes a tax on sellers of all sports equipment. Using the above figure, the area that equals the lost consumer surplus from this tax on sports equipment is
A) bcd.
B) P1P2cd.
C) P2P3ec.
D) ced.
B
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A lender who is worried that its cost of funds might rise during the term of a loan it has made can hedge against this rise without eliminating the chance to profit from a decline in the cost of funds by
A) buying futures contracts on Treasury bills. B) selling futures contracts on Treasury bills. C) buying put options on Treasury bills. D) buying call options on Treasury bills.
eBay has a seller reputation system to provide
A) consumers with a signal concerning seller quality. B) sellers a chance to signal other sellers concerning their quality. C) a reduction in monopoly power. D) improvements in investor relations.
All the costs of a transaction are referred to as
A) transfer costs. B) transactions costs. C) marketing expenditures. D) accounting costs.
Minimum wage in the U.S. is:
A. Set at the federal level, and all states abide by that level B. Set at the federal level, but many states set their own minimums that are higher than the federal level C. Set at the federal level, but many states set their own minimums that are lower than the federal level D. Set at the state level, not by the federal government