Refer to Figure 9.3. If the government establishes a price ceiling of $1.00, the resulting deadweight loss will be
A) $1.50.
B) $200.
C) $150.
D) $300.
E) $600.
C
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Consuming one more of a good increases its marginal-utility-to-price ratio, and consuming one less of the other good lowers its marginal-utility-to-price ratio
a. True b. False Indicate whether the statement is true or false
Assume that foreign capital flows into a nation rise due to expected increases in stock market appreciation. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the real risk-free interest rate and reserves account in the context of the Three-Sector-Model? a. The real risk-free interest rate falls and reserves account becomes more
negative (or less positive). b. The real risk-free interest rate rises and reserves account becomes more negative (or less positive). c. The real risk-free interest rate and reserves account remain the same. d. The real risk-free interest rate rises and reserves account remains the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
Economists view positive statements as
a. affirmative, justifying existing economic policy. b. optimistic, putting the best possible interpretation on things. c. descriptive, making a claim about how the world is. d. prescriptive, making a claim about how the world ought to be.
Free trade may be good for a nation, but not for everyone in the nation. Explain why free trade is controversial and the list the justifications that proponents of trade adjustment assistance offer in support of those policies
What will be an ideal response?