The above figure shows the U.S. market for chocolate. With no international trade, consumer surplus is equal to ________ and producer surplus is equal to ________
A) area A + area B + area C + area D; area E
B) area B + area C + area D; area A + area E
C) area A; area E
D) area C + area D; area B + area E
E) area E; area A + area B + area C + area D
C
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Continuing with the same vacation-insurance company from the preceding question, what vacation-day price(s) would be acceptable to both the family and the insurance company?
a. 3 or 4 b. 3,4 or 5 c. 3,4,5 or 6 d. 3,4,5,6 or 7
Define net capital outflow
Which of the following ways of distributing the laptops would be more efficient? (Check all that apply.)
A. Using a first-come, first-served rule. B. Auctioning off the laptops to the highest bidders. C. Using a random lottery to decide who gets the laptops. D. Using flexible prices, so those who value the laptop more would pay more for it.
For an inferior good,
a. the income effect is greater than the substitution effect. b. the income effect is smaller than the substitution effect. c. the income effect equals to the substitution effect. d. none of the above occurs.