A price ceiling that is set below the equilibrium price will result in:
A. a shortage of the good.
B. a surplus of the good.
C. higher total economic surplus.
D. higher producer surplus.
Answer: A
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From an economic perspective, a student's decision to go to the movies instead of studying for a test indicates that in the student's thinking the marginal
A. benefit of studying is greater than the marginal benefit of going to the movies. B. cost of going to the movies is less than the marginal benefit of going to the movies. C. benefit of studying is greater than the marginal cost of studying. D. cost of going to the movies is greater than the marginal cost of studying.
The tax multiplier is negative because increases in taxes lead to decreases in consumer spending
Indicate whether the statement is true or false
The basic argument for income inequality is that:
A. the very rich establish consumption patterns that are desirable for the rest of society to emulate. B. the rich buy luxury goods that soon become affordable to everyone else because of economies of scale. C. income inequality is essential to maintain incentives to produce. D. inequality undermines incentives and tends to reduce the size of the national income.
Which of the following is TRUE about species in the world?
A. No species has ever become extinct. B. Most extinct species became extinct within the past 30 years. C. The majority of extinct species became extinct before humans appeared. D. Extinct species became extinct only after human appeared.