If the government imposes a price floor that is higher than the market clearing price, then
A) consumer surplus will increase while producer surplus will decrease.
B) consumer surplus will decrease while producer surplus will increase.
C) both consumer surplus and producer surplus will decrease.
D) both consumer surplus and producer surplus will increase.
Answer: C
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Which of the following best represents an indirect tax?
A) federal income tax B) state income tax C) local property tax D) sales taxes paid on goods and services
A technological improvement can cause the production possibilities curve to shift outward because
A) it increases costs and contributes to lower production rates. B) maximum feasible outputs of both goods increase. C) production will fall, but jobs will be saved. D) it causes increases in unemployment.
The decline in the average number of hours worked over the last century from 60 hours to 40 hours can be explained as a consequence of
a. an increase in nonlabor income shifting labor supply to the left. b. an increase in nonlabor income shifting labor supply to the right. c. a decrease in the demand for labor. d. an improved understanding of the importance of sleep to labor productivity.
The market supply curve shows how the total quantity supplied of a good varies as input prices vary, holding constant all the other factors that influence producers' decisions about how much to sell
a. True b. False Indicate whether the statement is true or false