The welfare loss due to a price floor
a. is caused by a decrease in quantity
b. is the dollar difference between producer surplus and consumer surplus
c. is measured as the area above the market price and below the demand curve
d. is measured as the area above both the market price and the supply curve
e. is a Pareto improvement
A
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The idea that less government regulation will lower the cost of production, increase profit, and raise the level of production so that, in the end, real GDP will increase is held by the
a. classical school b. Keynesian school c. rational expectations school d. school of supply-side economics e. neo-Keynesian school
The purpose of an initial public offering is to
A. Borrow funds for investment and growth. B. See if there is a demand for a company's new product. C. Raise funds for investment and growth by selling shares of the company to the public. D. Change the membership of the board of directors.
In the 1950s, W. Phillips investigated the relationship between
A. wage and price inflation. B. the unemployment rate and the rate of change in interest rates. C. the unemployment rate and the rate of change in prices. D. output and price changes.
Income elasticity will be positive for:
A. all normal goods. B. only necessities. C. only luxury goods with substitutes. D. all inferior goods.