The market demand function for wheat is Qd = 10 - 2P and the market supply function is Qs = 4P - 2, both measured in billions of bushels per year. Suppose the government wants to increase the price of wheat to $3/bushel and they impose a voluntary production reduction program to achieve their goal. What is the size of the consumer surplus?
A. $4 billion
B. $8 billion
C. $18 billion
D. $6 billion
A. $4 billion
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A speculator becomes the floating-rate payer in an interest-rate swap. She hopes that
A) long rates rise. B) long rates fall. C) short rates rise. D) short rates fall.
If both Ben and Catherine value good X more than good Y, a firm can increase profits by bundling the two products
Indicate whether the statement is true or false
Assume that there are no excess reserves in the banking system when the reserve requirement is 20%. The purchase of $10,000 in U.S. government securities by the Fed from Academy National Bank has the potential to ultimately increase the money supply by: a. $2,000
b. $8,000. c. $10,000. d. $20,000. e. $50,000.
The value of $100 left in a certificate of deposit for four years that earns 4.5% annually will be:
A. $117.00 B. $145.00 C. $119.25 D. $120.00