Use the figure below to answer the following question.
What area represents society's total surplus after the government imposes the excise tax on the market?
A. triangle $1c$9 plus triangle $21a$13
B. triangle abc
C. square $13ac$9 plus triangle abc
D. triangle $1c$9 plus triangle $21a$13 plus rectangle $13ac$9
Answer: D
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Assume that the reserve requirement is 25%. If the Federal Reserve sells $120 million in government securities to the general public, the money supply will immediately ________.
A. increase by $120 million with this transaction, and the increase in money supply could eventually reach a maximum of $480 million B. increase by $120 million with this transaction, and the increase in money supply could eventually reach a maximum of $360 million C. decrease by $120 million with this transaction, and the decrease in money supply could eventually reach a maximum of $480 million D. decrease by $120 million with this transaction, and the decrease in money supply could eventually reach a maximum of $360 million
A consumer is willing to purchase a product up to the point where
A) he spends all of his income. B) the marginal benefit is equal to the price of the product. C) he is indifferent between consuming and saving. D) the quantity demanded is equal to the quantity supplied.
What policies would you recommend to the U.S. government to lower the balance of trade deficit and decrease net capital inflows?
What will be an ideal response?
Which of the following events would increase producer surplus?
a. Sellers' costs stay the same and the price of the good increases. b. Sellers' costs increase and the price of the good stays the same. c. Sellers' costs increase and the price of the good decreases. d. All of the above are correct.