The deadweight loss from monopoly pricing is:
A. the amount by which aggregate surplus falls short of its minimum possible value, which is attained in a perfectly competitive market.
B. the amount by which consumer surplus exceeds producer surplus.
C. the amount by which aggregate surplus falls short of its maximum possible value, which is attained in a perfectly competitive market.
D. the amount by which producer surplus exceeds consumer surplus.
C. the amount by which aggregate surplus falls short of its maximum possible value, which is attained in a perfectly competitive market.
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You notice that when the inflation rate increases, the interest rate tends to increase. This observation indicates that
A) there might be false causality between inflation and the interest rate. B) higher inflation rates must cause a higher interest rate. C) a scatter diagram of the inflation rate and the interest rate will show a positive relationshi
If you pay $2,000 in taxes on an income of $20,000, and a tax of $3,000 on an income of $30,000, then over this range of income the tax is
A) regressive. B) proportional. C) progressive. D) There is insufficient information to answer the question.
Which of the following best defines the vicious circle of poverty?
a. Countries are poor because of lack of education and training for workers. b. Countries are poor because of poor international credit. c. Countries are poor because of high population growth. d. Countries are poor because they cannot afford to save and invest.
Why do we seldom see people asking to have their own wages reduced?
a. People are usually narrow-minded. b. People usually overestimate themselves. c. People usually look out for their own self-interest. d. People are usually selfish.