Producer surplus for a particular unit of a good is the price the seller receives for that unit minus the largest amount the seller would accept for it
a. True
b. False
B
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If the price elasticity of demand for a product is -2.5, then a price cut from $2.00 to $1.80 will ________ the quantity demanded by about ________.
A. decrease; 2.5% B. increase; 25% C. increase; 250% D. increase; 2.5%
During the bureaucratic bargaining process, if the legislature tries to counteroffer by saying it wants less output at a given price, the bureau's can employ the strategy of _____
a. saying no b. telling the legislature that reducing the output would endanger lives c. telling the legislature that at the lower output, the price per unit will be much higher d. making a counter-offer of more output at a lower price
Why does unemployment tend to change when the level of output changes?
a. Persons wish to buy things, and if output falls, people need to work less to earn the income to buy the smaller output. b. Labor is an input, and if output falls, employers need fewer workers to make it, so the employment falls. c. When output rises, persons are more interested in buying, and will work more to earn the income to buy things. d. Persons face the option of buying or working, so that when they do more of one, the other necessarily falls. e. When companies replace workers with machines, output rises, and people take time off from work to buy before returning to employment.
When the economy slows down the:
A. supply of workers increases. B. demand for workers increases. C. demand for workers decreases. D. supply of workers decreases.