Explain why producers rather than consumers may be the beneficiaries of regulation. Does the evidence support this view?
The benefits of much economic regulation are concentrated on a small number of producers while the costs
are spread among millions of consumers. Therefore, the producers should be expected to get more involved
in the regulatory process than consumers. Evidence includes railroads and trucking under the ICC, and
import quotas in steel and automobiles.
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Which of the following occurs when a market is efficient?
A) Producers earn the highest income possible. B) Production costs equal total benefit. C) Consumer surplus equals producer surplus. D) Scarce resources are used to produce the goods and services that people value most highly. E) Every consumer has all of the good or service he or she wants.
What two trends was Canada trying to address in negotiating CUSTA?
What will be an ideal response?
Unlike the Classical economists, Keynes believed that money could affect real economic activity through its effects on
A) the price level. B) the interest rate. C) savings. D) velocity.
Which of the following would be considered part of income?
A. Wages and salaries B. The value of a house C. Corporate stock holdings D. Money in a bank account