With reference to the graph above, if the intended aim of the price ceiling set at $6 was a net increase in the well-being of consumers, then positive analysis would consider:
A. whether the surplus transferred from consumers to producers is larger than the consumer surplus lost to deadweight loss.
B. whether the producer surplus lost to deadweight loss is larger than the producer surplus gained from a higher price.
C. whether the surplus transferred from producers to consumers is larger than the consumer surplus lost to deadweight loss.
D. whether the producer surplus lost due to lower prices is larger than the producer surplus lost due to fewer transactions taking place.
C. whether the surplus transferred from producers to consumers is larger than the consumer surplus lost to deadweight loss.
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According to PPP, the real exchange rate between two countries will always equal
A) 0.0. B) 0.5. C) 1.0. D) 1.5.
An automobile company has two factories, one in Vietnam and one in Australia each with the same number of workers. The Vietnamese factory can produce either 150 engines or 100 transmissions per day
The Australian factory can produce either 100 engines or 75 transmission per day. A) The Vietnamese factory has an absolute advantage producing both engines and transmissions. B) The Australian factory has an absolute advantage in the production of transmissions. C) The Vietnamese factory has a comparative advantage in the production of transmissions. D) Which factory has an advantage is irrelevant since the theory of comparative advantage only applies to countries, not companies.
Cooling systems Carl is the lead engineer on a smart HVAC cooling system that works with minimal energy and is voice activated. Given the revolutionary nature of the system, it took many failed tries to create a system that actually worked, a cost of
$30,000 . Now each unit sells for $6500 and it costs $5000 in raw materials and labor to produce. What costs should Carl take into consideration when deciding to service the order for an additional unit?
In the classical model, beginning from an equilibrium in which the government is running a budget surplus, an increase in government spending will
a. lower the wage rate b. increase the supply of loanable funds c. cause total spending to decline d. cause total spending to increase e. leave total spending unchanged