Refer to Figure 18-2. If the government imposes an excise tax of $1.00 on every unit sold, the government's revenue from the tax is represented by the area
A) (PaPc × Qa) if the supply curve is S0 and (PbPc × Qb) if the supply curve is S1.
B) (PbPe × Qb) under either supply curve.
C) (PaPd × Qa) if the supply curve is S0 and (PbPe × Qb) if the supply curve is S1.
D) (PaPe × Qa) under either supply curve.
C
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The above figure shows the apartment market in Big City. If a government policy results in a shortage of 1,500 apartments in the Big City rental market, it is most likely that the Housing Authority has imposed
A) a rent ceiling of $1500.00 monthly. B) a rent ceiling of $1000.00 monthly. C) a rent floor of $1500.00 monthly. D) a rent floor of $1000.00 monthly.
For each watch Denmark produces, it gives up the opportunity to make 50 pounds of cheese. Germany can produce one watch for every 100 pounds of cheese it produces. Which of the following is true with regard to opportunity costs in the two countries?
a. The opportunity cost of producing watches is higher in Denmark. b. The opportunity cost of producing cheese is higher in Denmark. c. The opportunity cost of producing cheese is identical in both countries. d. It is impossible to compare opportunity costs because the two countries use different currencies. e. In both countries combined, the opportunity cost of one watch is 150 pounds of cheese.
Define the following terms and explain their importance to the study of macroeconomics:
a. velocity b. equation of exchange c. monetarism d. automatic stabilizer
Consider an industry with two firms producing similar products. Each firm's total cost (in dollars) is given below.Acme Manufacturing: TC = 100 + 3Q Generic Industries: TC = 500 + 3Q When each firm is producing the same quantity, Acme's average total cost is:
A. lower than Generic's average total cost at some levels of output, and higher than Generic's average total cost at other levels of output. B. lower than Generic's average total cost. C. equal to Generic's average total cost. D. higher than Generic's average total cost.