If a positive permanent supply shock were to occur, the resulting equilibrium would be a:
A. higher level of output at lower prices.
B. lower level of output and prices.
C. higher level of output and prices.
D. lower level of output at higher prices.
Answer: A
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Consider a perfectly competitive market, with no externalities. A binding price ceiling is imposed. The decrease in market quantity relative to the perfect competition outcome is bigger when:
A. Supply is elastic B. Supply is inelastic C. Demand is elastic D. Demand is inelastic E. Need more information.
Which price structure would tend to most effectively promote water conservation?
a. Uniform block structure b. Constant price structure c. Increasing block structure d. Decreasing block structure e. Marginal price structure
Why is it easier to raise $1 million in voluntary contributions for medical research into a deadly disease like cancer than it is to raise the same amount for space exploration?
What will be an ideal response?
The benefits of social regulation usually are
A. always a zero sum. B. difficult to measure. C. less than the costs of social regulation, reducing overall welfare. D. obvious to people while the costs are hidden.