According to the graph shown, if the market goes from equilibrium to having its price set at $10 then:
A. producer surplus will change from (B + C + D + E) to D only.
B. producer surplus will change from (D + E) to (D + B).
C. producer surplus will change from (D + E) to (D + E + B + C).
D. producer surplus will change from (D + B) to (D + E).
Answer: B
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All else held constant, if farmers receive a subsidy for their corn, then this would cause a
A. movement up along the current supply curve of corn. B. movement down along the current supply curve of corn. C. rightward shift in the current supply of corn. D. leftward shift in the current supply of corn.
Though the owners of NFL and MLB teams may be able to show that they lose money each year, economists who study the subject insist that they
A. lose the same amount as they do in their other businesses. B. lose money only if they lose games. C. are using phony accounting tricks to come up with those losses, and that every franchise makes money. D. still make money because they can sell their team for much more than they paid for it.
Walter builds birdhouses. He spends $5 on the materials for each birdhouse. He can build one in 30 minutes. He is semi-retired but earns $8 per hour at the local hardware store. He can sell a birdhouse for $20 each. An accountant would calculate the total cost for one birdhouse to be
a. $5. b. $8. c. $9. d. $13.
Monetary policy is determined by
a. the president and Congress and involves changing government spending and taxation. b. the president and Congress and involves changing the money supply. c. the Federal Reserve and involves changing government spending and taxation. d. the Federal Reserve and involves changing the money supply.