In Figure 32.1, at the supported price-quantity combination where production is limited, the producer surplus is 
A. APfloorB.
B. HP*C.
C. P*AC.
D. HPfloorBG.
Answer: D
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As a manufacturer becomes a mass producer, generally productivity ____ and wage rates _____.
A. falls; fall B. rises; rise C. rises; fall D. falls; rise
U.S. net export spending falls when
A) the inflation rate is lower in the United States relative to other countries. B) the growth rate of U.S. GDP is faster than the growth rate of GDP in other countries. C) the value of the U.S. dollar decreases relative to other currencies. D) the price level in the United States falls relative to the price level in other countries.
Assume Dell and Toshiba computers are substitutes in consumption; if the price of dell computers increases we would expect to see
a. An increase in demand for Toshiba computers b. An decrease in demand for Toshiba computers c. An increase in the quantity of Toshiba computers demanded d. An decrease in the quantity of Toshiba computers demanded
The presence of a negative externality is likely to give rise to significant market failures when: a. property rights are not well-defined
b. property rights are well-defined. c. there are few victims of pollution and few polluters. d. transaction costs are relatively low.