The deadweight loss of taxation:
A. is the lost consumer surplus due to a gain in producer surplus from a tax.
B. is the lost producer surplus due to a gain in consumer surplus from a tax.
C. is the lost aggregate surplus due to a tax.
D. is the difference between consumer and producer surplus after a tax.
C. is the lost aggregate surplus due to a tax.
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If the inflation rate falls and nominal interest rates are unchanged,
A) inflation will fall. B) inflation will continue at the same rate. C) real interest rates rise. D) real interest rates are unaffected. E) real interest rates fall.
Bill consumes two goods: iced tea and spaghetti. The price of iced tea is $2 per bottle, and the price of spaghetti is $8 per serving. His income is $1,000 per month. He spends all of his income each month. He purchases 200 bottles of iced tea. How many servings of spaghetti does he purchase?
a. 125 b. 75 c. 50 d. 10
Which of the following is the most likely outcome of raising the minimum wage?
a. an increase in both the quantity of labor supplied by workers and the quantity of labor demanded by firms b. an increase in the quantity of labor supplied by workers and a decrease in the quantity of labor demanded by firms c. a decrease in the quantity of labor supplied by workers and an increase in the quantity of labor demanded by firms d. a decrease in both the quantity of labor supplied by workers and the quantity of labor demanded by firms
Protectionism achieves which of the following goals?
A. Protection of infant industries. B. Greater consumption possibilities through greater specialization. C. Protection of absolute advantage. D. Protection of comparative advantage.