If a price ceiling of $8 were placed on the market in the graph shown, which area represents the surplus that is transferred from producers to consumers?
A. C + D + F + G
B. C + D
C. F + G
D. C
D. C
You might also like to view...
When is a firm more likely to engage in excessively risky behaviors, when business is well, or when it is facing financial distress?
What will be an ideal response?
The slope of the perfectly inelastic demand curve is ________, the slope of the perfectly elastic demand curve is ________
A) undefined, zero B) one, one C) zero, undefined D) one, zero
Tom and Jerry have two tasks to do all day: make dishes and build fences. If Tom spends all day making dishes, he will have make 16 dishes. If he instead devotes his day to building fences, Tom will build 4 fences. If Jerry spends his day making dishes, he will make 14 dishes; if he spends the day building fences, he will build 7 fences. Jerry has a comparative advantage in:
A. dish production because he has the higher opportunity cost of a dishes. B. fence production because he has the higher opportunity cost of a fence. C. dish production because he has the lower opportunity cost of a dishes. D. fence production because he has the lower opportunity cost of a fence.
Transaction costs are
A. not true costs since they are often not paid. B. the costs associated with making a transaction that is required by the government. C. the costs associated with making, reaching and enforcing agreements. D. the costs associated with exchanges in the service area.