Aggregate producer surplus in an industry is measured along the market supply curve is and only if firm production technologies exhibit the quasilinearity property.
Answer the following statement true (T) or false (F)
False
Rationale: Aggregate producer surplus is always measured along the market supply curve.
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Supply curves are usually assumed to slope upward because
a. profits fall as prices rise b. a higher price leads to increases in demand c. a higher price leads to decreases in demand d. a higher price attracts resources from other less valued uses e. firms drop out of the market as prices rise
A tax multiplier equal to –4.30 would imply that a $100 tax increase would lead to a
a. $430 decline in national income b. $430 increase in national income c. 4.3 percent increase in national income d. 4.3 percent decrease in national income e. 43 percent decrease in national income
Among the impediments to the international mobility of capital are
a. restrictions on foreign ownership. b. fear of nationalization or political instability. c. fluctuations in exchange rates. d. All of the above are correct.
Suppose Sam buys a good for $100 at a yard sale. If consumer surplus from the sale is $75, Sam would have been willing to pay:
A. $100. B. $175. C. $25. D. equal to the deadweight loss.