Refer to Figure 4-5. Suppose that instead of a price ceiling, the government imposed a price floor of R1. What is the area representing producer surplus after the imposition of the price floor?
A) B + C + D + E + F B) A C) B + D + F D) C + E
C
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The basic idea behind an auction is that:
A) buyers want to buy from the sellers with the lowest ask prices, and sellers want to sell to buyers with the highest bid prices. B) buyers want to buy from the sellers with the highest ask prices, and sellers want to sell to buyers with the highest bid prices. C) buyers want to buy from the sellers with the highest ask prices, and sellers want to sell to buyers with the lowest bid prices. D) buyers want to buy from the sellers with the lowest ask prices, and sellers want to sell to buyers with the lowest bid prices.
Investment demand is downward sloping because as the interest rate decreases,
A) each project's internal rate of return decreases. B) each project's internal rate of return increases. C) more projects will have an internal rate of return that exceeds the interest rate. D) more projects will have an internal rate of return that is less than the interest rate.
Eight years ago you purchased an asset for $100,000 that has yielded a nominal capital gain of $30,000. If you sold the asset today, your inflation-adjusted capital gains would be zero due to inflation over the last eight years
The capital gains tax is 28 percent. If you sold the asset today your tax liability would be A) zero. B) $28,000. C) $8,400. D) cannot be determined without more information.
For a perfect competitor, marginal revenue equals
A) the slope of the demand curve. B) average revenue divided by price. C) price divided by average revenue. D) the market price.