A demand curve that is drawn as a vertical line has a price elasticity of demand equal to:
A. 0.
B. the quantity.
C. 1.
D. infinity.
Answer: A
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What is the difference between a price support and a price floor?
A) A price support is below equilibrium; a price floor is above it. B) A price support is above equilibrium; a price floor is below it. C) Government buys the excess supply to maintain a price floor, but not a price support. D) Government buys the excess supply to maintain a price support, but not for a price floor. E) There is no difference between the two.
According to the graph shown, if this economy were to open to trade, surplus would do all of the following except:
This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
A. increase overall.
B. decrease for the producer.
C. transfer from producer to consumer.
D. create deadweight loss of CEFG.
Transfer programs are so named because they transfer:
a. the burden of poverty alleviation from the church to the state. b. the poverty from the country side to the city. c. the responsibility for maintaining minimum standards of living from the federal government to state governments. d. income from the relatively high-income people to relatively low-income people. e. the incidence of poverty from predominantly ethnic groups to the majority white population.
If a ton of steel sells for $15,000 and a car made from a ton of steel sells for $30,000, then if all markets are perfectly competitive, how many cars can be made from the last ton of steel used by a profit-maximizing firm?
A. 1/3 car B. 1/2 car C. 1 car D. 1.5 cars