An effective price ceiling usually generates
A. higher nominal prices.
B. happy sellers and dissatisfied buyers.
C. the use of nonprice rationing devices.
D. fire sales as firms try to unload their excess inventories.
Answer: C
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Refer to Scenario 1 . Assume this economy could either be at Point B or Point C. From which of these points is it more costly to produce more crabs? Explain your answer
What will be an ideal response?
Negative marginal revenue means that
a. the firm is maximizing its economic profit b. the firm is maximizing its total revenue c. total revenue is increasing at an increasing rate as output increases d. total revenue is increasing at a decreasing rate as output increases e. total revenue is decreasing as output increases
The transactions demand for money increases when more people want to hold some of their wealth in the form of money to reduce the risks associated with unexpected emergencies
a. True b. False Indicate whether the statement is true or false
Refer to the accompanying figure, which shows the market for cups of coffee. At the original market equilibrium:
A. 50 cups are sold per hour at a price of $1.00 each. B. 60 cups are sold per hour at a price of $1.50 each. C. 40 cups are sold per hour at a price of $2.00 each. D. 50 cups are sold per hour at a price of $2.50 each.