When looking at this graph for the welfare effects of a subsidy, a 50 percent decrease in the size of area F would mean ______.
a. consumer surplus increased
b. deadweight loss increased
c. quantity produced decreased
d. overall efficiency decreased
c. quantity produced decreased
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The tendency for consumers to purchase more of a good or service as its price falls is captured by:
A. the law of supply. B. the law of increasing cost. C. the law of demand. D. cross-price elasticity of demand.
"If Mexico is currently operating at a point beyond its production possibilities frontier, then there are unemployed resources in Mexico." Is this statement true or false? Briefly explain your answer
What will be an ideal response?
Economists are concerned with an individual's
A) needs because needs represent the most important goods to an individual. B) needs because economists define needs to be the goods people need to survive. C) wants because, unlike needs, wants lead to shortages in the economy. D) wants because the existence of wants leads to scarcity.
If a specific segment of a demand curve is price elastic, then we know that anywhere along that segment, the
a. percentage change in the quantity demanded exceeds one b. percentage change in quantity demanded exceeds the percentage change in price c. percentage change in price exceeds the percentage change in quantity demanded d. the change in quantity demanded exceeds the change in price e. the good has no close substitutes