If the intended aim of the price floor set in the graph shown was a net increase in the well-being of producers, then normative analysis would conclude that:
A. the policy was effective, since surplus gained by producers through higher prices is greater than the surplus they lost through deadweight loss.
B. the policy was ineffective, since surplus gained by producers through higher prices is greater than the surplus they lost through deadweight loss.
C. the policy was effective, since surplus gained by producers through higher prices is greater than the surplus lost by consumers through higher prices.
D. there is no "right" conclusion to be reached in a normative sense, since people have different opinions concerning what constitutes a better outcome.
D. there is no "right" conclusion to be reached in a normative sense, since people have different opinions concerning what constitutes a better outcome.
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Figure 4.4 illustrates the supply of tacos. A decrease in the supply of tacos is represented by a movement from
A) point a to point b. B) point c to point b. C) S0 to S1. D) S2 to S1.
The role of the costs of capital is influenced by the degree to which firms can substitute capital for other inputs of production known as relative prices
Indicate whether the statement is true or false
Extremely high rates of inflation such as that experienced by Nicaragua in the 1980s are described as
A. deflation. B. hyperinflation. C. disinflation. D. inflation.
Minimum efficient scale is defined as
A. the point at which economies of scale are at their maximum. B. the amount of labor that maximizes the marginal product of labor. C. the point at which marginal cost, average variable cost, and average fixed cost are all equal. D. the lowest output level at which long-run average costs are at their minimum.