Refer to the diagram. The area that identifies the maximum sum of consumer surplus and producer surplus is:
A. a + b + c + d + e + f.
B. c + d + f.
C. a + b + e.
D. a + b + c + d.
D. a + b + c + d.
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The long-run effect of an increase in the money supply when starting from full employment is to
A) increase real GDP only. B) increase the price level only. C) increase both real GDP and the price level. D) increase real GDP as the price level increases too.
The law of __________: as successive units of a variable resource are added to a fixed resource, the marginal product of the variable resource will eventually decline.
Fill in the blank(s) with the appropriate word(s).
Suppose that your tuition to attend college is $24,000 per year and you spend $8,000 per year on room and board. If you were working full time, you could earn $30,000 per year. What is your opportunity cost of attending college for one year?
A. $32,000 B. $38,000 C. $54,000 D. $62,000
If aggregate demand and nominal GDP increase while the price level is constant, we would conclude that
A. the aggregate supply curve is upward sloping. B. the aggregate supply curve is horizontal. C. the economy is already at full employment. D. the aggregate demand curve is vertical.