A price floor is a price
A) below which a seller cannot legally sell.
B) above which a seller cannot legally sell.
C) that creates a shortage of the good if it is set above the equilibrium price.
D) Both answers A and C are correct.
E) Both answers B and C are correct.
A
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Exhibit 30-3 Costs of Eliminating:Firm A Firm B Firm C 1st ton of pollution$ 30 $ 50 $ 600 2nd ton of pollution$ 70 $ 90 $ 700 3rd ton of pollution$125 $150 $ 900 4th ton of pollution$200 $250 $1,300 Refer to Exhibit 30-3. Suppose that Firms A, B, and C are the only polluters in the state and that each emits 4 tons of pollution into the atmosphere. To cut the level of pollution in half, the government mandates system whereby each firm must reduce its pollution level by one-half. The total cost of complying with the mandate is
A. $433. B. $1,540. C. $2,750. D. $8,570. E. $11,650.
Suppose an individual's MRS (of steak for beer) is 2:1 . That is, at the current consumption choices he or she is willing to give up 2 beers to get an extra steak. Suppose also that the price of a steak is $1 and a beer is 25¢. Then in order to increase utility the individual should
a. buy more steak and less beer. b. buy more beer and less steak. c. continue with current consumption plans. d. Not enough information to answer the question.
Which of the following is an example of a positive economic statement?
A) The U.S. public should devote more resources to education. B) The poor should pay lower taxes and the rich should pay higher taxes. C) Soap operas should be taken off television. D) If you drop a ball from the top of a building, it will fall to the ground.
The answer is, "They are mortgage loans granted to persons who might have low credit ratings." The question is:
A) What are traditional loans? B) What are collateralized debt obligations? C) What are subprime mortgage loans? D) What are securitized loans?