Refer to Figure 7-21. Which area represents total surplus in the market when the price is P1?
a. C+D
b. A+B
c. B+C
d. A+B+C+D
c. B+C
You might also like to view...
The funds used to buy and operate physical capital are
A) depreciation. B) financial capital. C) saving. D) wealth.
Of the following methods that banks might use to reduce moral hazard problems, the one not legally permitted in the United States is the
A) requirement that firms keep compensating balances at the banks from which they obtain their loans. B) requirement that firms place on their board of directors an officer from the bank. C) inclusion of restrictive covenants in loan contracts. D) requirement that individuals provide detailed credit histories to bank loan officers.
A straight-line production possibilities frontier indicates that ___
Fill in the blank(s) with the appropriate word(s).
The real rate of interest is 4% and the anticipated rate of inflation is 2%. What is the nominal rate of interest?
A. 6% B. 1% C. 2% D. 4%