If the equilibrium price for some product is $1000, a price ceiling of $1200 will result in
A) massive surpluses of the good.
B) the same general effects as a price floor of $1200.
C) the same general effects as an administered price of $1200.
D) the same general effects as a price ceiling of $600.
E) no effects because the price ceiling is not binding at that price.
Answer: E) no effects because the price ceiling is not binding at that price.
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In the figure above, the curve labeled "W" can be a
A) monopoly's demand curve. B) monopoly's marginal revenue curve. C) perfectly competitive firm's demand curve. D) perfectly competitive firm's marginal revenue curve.
The equilibrium effects of a temporary increase in government spending include
A) an increase in the real wage and an increase in the real interest rate. B) an increase in the real wage and a decrease in the real interest rate. C) a decrease in the real wage and an increase in the real interest rate. D) a decrease in the real wage and a decrease in the real interest rate.
The impact of a change in taxes on income is likely to be less than the effect resulting from a change in government spending since ________
A) the federal government typically operates in a deficit situation B) exports and imports can only assume positive values, but net exports can be positive or negative C) changes in the supply of money will be necessary if government spending is increased D) changes in taxes exert an indirect impact on total spending through changes in consumption
Compared to a single-price monopoly, a perfectly competitive market with the same costs produces ________ output and has a ________ price
A) less; lower B) less; higher C) more; lower D) more; higher