Suppose Mary is willing to pay up to $15,000 for a used Ford pick-up truck. If she buys one for $12,000, her ________ would be ________.
A. economic surplus; $12,000
B. benefit; $12,000
C. economic surplus; $3,000
D. cost; $15,000
Answer: C
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A temporary resource price differential refers to a price difference
a. that will not lead to a shift of resources among users b. caused by lack of resource mobility c. caused by economic rent d. that, for example, causes more workers to move to higher-paid areas e. caused by minimum wage legislation
An increase in government spending can lead to a decrease in GDP if the interest rate changes enough
a. True b. False
Securities markets perform a valuable economic function because they provide
a. an opportunity for investors to make money in a short time. b. the principal indicator of the performance of the U.S. economy. c. an easy way to transfer corporate securities, thereby reducing risk to investors. d. assurance that stock purchasers can get back the purchase price of their stock.
Suppose that the slope of a line tangent to the total cost curve at point X is steeper than the slope of a line tangent to the total benefit curve at point X, then:
A. net benefit would be increased by reducing the amount of the activity. B. net benefit would be decreased by reducing the amount of the activity. C. net benefit would be increased by increasing the amount of the activity. D. net benefit is maximized.