This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
According to the graph shown, if this economy were to open to trade, surplus would do all of the following except:
A. transfer from producer to consumer.
B. increase overall.
C. decrease for the producer.
D. create deadweight loss of CEFG.
Answer: D
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The real interest rate equals:
a. the nominal interest rate minus the inflation rate. b. the nominal interest rate plus the inflation rate. c. the inflation rate minus the nominal interest rate. d. none of the above.
A cost imposed on people other than the consumers of a good or service is a:
a. price floor. b. price ceiling. c. positive externality. d. negative externality.
In a market for emission permits, firms that emit over their allowed limits
A. must buy more allowances through a trading system. B. are forced to shut down. C. are taxed by the government for the amount of emissions. D. will sell their excess allowances through a trading system.
At lower interest rates the
A) money supply is lower. B) quantity of money demanded is higher. C) money supply is indeterminate. D) quantity of money demanded is lower.