Suppose the market clearing price for gasoline is $2.5 per gallon. Now suppose that policy makers pass a law requiring that the maximum price that can be charged is $2.3 per gallon. Such a situation is an example of
A. a price floor that will lead to a surplus of gasoline on the market.
B. a price ceiling that will lead to a shortage of gasoline on the market.
C. a price floor that will lead to a shortage of gasoline on the market.
D. a price control that will lead to a surplus of gasoline on the market.
Answer: B
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One result of the minimum wage is
A) a black market for labor that pays more than the minimum wage. B) a black market for labor that pays less than the minimum wage. C) decreased job search activity. D) a decrease in unemployment among poor and unskilled workers. E) an increase in employment among poor and unskilled workers.
For a firm with market power, advertising expenditures affect all of the following except which one?
A) total cost B) demand curve C) marginal cost D) marginal revenue
If the price of a product increases, the demand for the resource used in producing that product decreases
a. True b. False Indicate whether the statement is true or false
Any item that people can use to transfer purchasing power from the present to the future is called
a. a medium of exchange. b. a unit of account. c. a store of value. d. None of the above is correct.