With reference to the graph above, if the intended aim of the price ceiling set at $6 was a net increase in the well-being of consumers, then positive analysis would conclude:
A. the policy was effective, since surplus gained by consumers through lower prices is greater than the surplus they lost through deadweight loss.
B. the policy was ineffective, since surplus gained by consumers through lower prices is less than the surplus they lost through deadweight loss.
C. the policy was effective, since surplus lost by producers through lower prices is less than the surplus gained by consumers through lower prices.
D. the policy was ineffective, since the amount of deadweight loss is greater than the surplus gained by consumers from lower prices.
A. the policy was effective, since surplus gained by consumers through lower prices is greater than the surplus they lost through deadweight loss.
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An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase B. increase; increase C. decrease; decrease D. increase; decrease
The U.S. produces and sells millions of different products. To aggregate them together into a single measure of domestic output, the quantity of each good produced is weighted by its ________.
A. utility to consumers B. cost of production C. market price D. contribution to corporate profits
People learn to hold a specific quantity of money for the groceries, theater tickets, gasoline, clothes, film, and other items they habitually purchase. This behavior is representative of the:
a. precautionary demand. b. speculative demand. c. transactions demand. d. volatility demand. e. liquidity demand.
Of the industries listed? below, which one does not receive significant protection from either or both the United States and? Japan?
A. Textiles B. Clothing C. Agriculture D. Automobiles