Suppose the government imposes a price support that is above the equilibrium price. As a result,
A) total revenue increases.
B) consumer surplus increases.
C) the marginal cost of the last unit produced decreases.
D) the government has effectively imposed a price ceiling.
E) the subsidy the government pays decreases.
A
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Where Y is GDP, C is consumption, I is investment, G is government purchases, T is net taxes, and there is no international trade, the government budget deficit equals:
A. Y + T - G. B. T - G. C. Y - G. D. G - T.
When a teacher in a private school points out to her high school principal that since there are empty seats in all classrooms, the cost of additional students is really zero, she is using the
A. law of comparative advantage. B. principle of marginal analysis. C. theory of externalities. D. notion of the cost decreases of the service sector. E. concept of opportunity cost.
According to the misperceptions theory of the short-run aggregate supply curve, if a firm thought that inflation was going to be 4 percent and actual inflation was 2 percent, then the firm would believe that the relative price of what it produces had
a. increased, so it would increase production. b. increased, so it would decrease production. c. decreased, so it would increase production. d. decreased, so it would decrease production.
What is the present value of $1 that will be paid to you in 5 years if the interest rate is 7%? Work it out to the nearest tenth of a cent.
What will be an ideal response?