The graph above shows supply and demand in the domestic market without trade. Consumer surplus without trade is represented by area
A) P1-E-Po
B) P1-E-0
C) Po-E-0
D) P1-E-Qo
A
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Last year, the price of heating oil was $4 per gallon, and Jonetta purchased 100 gallons of heating oil. This year, the price of heating oil falls to $3 per gallon while Jonetta's income is unchanged. Jonetta decides to share her good fortune by giving her retired father a gift of $100. Consider an indifference curve-budget line diagram with heating oil on the horizontal axis and "all other goods" on the vertical axis.
(i) Does the price change make Jonetta's budget line flatter or steeper? Justify your choice. (ii) After Jonetta gives the $100 gift, will her new budget line lie above, lie below, or pass through her initial optimum? Justify your choice. (iii) Sketch an indifference curve-budget line diagram that illustrates this situation. This year, will Jonetta be better or worse off than she was last year?
Why do some firms practice price discrimination? Relate your answer to the common practice of public colleges charging lower tuition to in-state students and higher tuition to out-of-state students
What will be an ideal response?
If real GDP increases from $5 billion to $5.25 billion and the population increases from 2 million to 2.02 million, real GDP per person increases by ___ percent
A. 5.0 B. 1.0 C. 2.5 D. 4.0
In the model of monopolistic competition, if firms have ________ average cost curves, then opening trade will ________ the total number of firms and ________ the average price
A) downward sloping; decrease; decrease B) downward sloping; decrease; increase C) downward sloping; increase; decrease D) upward sloping; decrease; increase E) upward sloping; increase; decrease