Which of the following statements best describes consumer surplus in the supply and demand model?
a. Consumer surplus is the area in the supply and demand model that is above the market price and above the demand curve.
b. Consumer surplus is the area in the supply and demand model that is below the market price and below the demand curve.
c. Consumer surplus is the area in the supply and demand model that is above the market price and below the demand curve.
d. Consumer surplus is the area in the supply and demand model that is below the market price and above the demand curve.
c. Consumer surplus is the area in the supply and demand model that is above the market price and below the demand curve.
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The above figure shows the marginal private cost curve, marginal social cost curve, and marginal social benefit curve for raising goats on a common pasture. The market equilibrium with no government intervention is raising ________
A) 0 goats B) 40 goats C) 50 goats D) 55 goats
If an employer begins to pay higher wages to white workers, then in the short run
a. wages for white workers would fall b. wages for nonwhite workers would rise c. profits would rise as nonwhite workers leave the firm d. output will increase and prices will fall e. profits would fall as nonwhite workers leave the firm
If air travel and bus travel are substitutes,
a. an increase in the price of bus travel will decrease the demand for air travel. b. a decrease in the price of bus travel will decrease the demand for air travel. c. an increase in the price of bus travel will generally have no effect on the demand for air travel. d. an increase in the price of bus travel will shift the demand curve for air travel to the left.
Efficient markets theory suggests that purchasing the published reports of financial analysts
A. is not likely to increase financial returns. B. is likely to increase one's returns by an average of 5 percent. C. will increase financial returns in the first year but not in following years. D. is likely to increase one's returns by an average of about 3 to 5 percent.