In an unregulated, competitive market consumer surplus exists because some
A) sellers are willing to take a lower price than the equilibrium price.
B) consumers are willing to pay more than the equilibrium price.
C) sellers will only sell at prices above equilibrium price (or actual price).
D) consumers are willing to make purchases only if the price is below the actual price.
B
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According to your text, there are substitutes for any scarce good,
A) but some demand curves are vertical. B) but the elasticity of demand for most goods is zero. C) but the law of demand only holds for inexpensive goods. D) but it often takes time for consumers to seek out useful substitutes.
A constant-cost industry is distinguished by the fact that
a. firms' long-run average cost curves are horizontal b. firms' short-run marginal cost curves are horizontal c. firms' short-run average total costs are horizontal d. the short-run industry supply curve is perfectly elastic e. the long-run industry supply curve is perfectly elastic
Government intervention in the marketplace for the purpose of influencing prices should be done whenever the opportunity cost of such actions falls to zero
Indicate whether the statement is true or false
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y1. C. P3 and Y1. D. P3 and Y2.