Refer to the graph shown. Assume the market is initially in equilibrium at point b in the graph but the imposition of a per-unit tax on this product shifts the supply curve up from S0 to S1. The lost producer surplus of this tax is equal to the area:
A. P1P2cb.
B. abc.
C. P1(P2 ? t)ab.
D. bcd.
Answer: C
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In 2012, the House of Representatives voted to have what type of audit of the Fed?
A) auditing of financial statements B) auditing lending policy that took place during the financial crisis of 2007-2009 C) auditing of monetary policy decisions D) auditing of personal finances of members of the Board of Governors
Suppose you received a 5 percent increase in your nominal wage. Over the year, inflation ran about 2 percent. Which of the following is true?
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If the quantity demanded of a certain good responds only slightly to a change in the price of the good, then the
a. demand for the good is said to be elastic. b. demand for the good is said to be inelastic. c. law of demand does not apply to the good. d. demand curve for the good shifts only slightly in response to a change in price.
Which of the following will most likely be an unanticipated economic change?
What will be an ideal response?