Suppose a price ceiling is set above the equilibrium price. Now suppose that policy makers decide to raise the price ceiling. This increase in the price ceiling will cause which of the following to occur?
A) The surplus in the market will increase.
B) The surplus in the market will decrease.
C) The shortage in the market will increase.
D) none of the above
D
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In a short-run macroeconomic equilibrium, real GDP exceeds potential GDP. If aggregate demand does not change, then the
A) short-run aggregate supply curve will shift rightward as the money wage rate falls. B) short-run aggregate supply curve will shift leftward as the money wage rate rises. C) long-run aggregate supply curve will shift leftward as the money wage rate rises. D) long-run aggregate supply curve will shift leftward as the money wage rate falls.
The factor that leads to underpricing and overuse of an economic resource is
A. human greed and selfishness. B. capital markets. C. the lack of an enforceable property right. D. the lack of understanding of pollution and its effects.
Which of the following is an explicit cost of production?
A. the electric bill B. wages paid to workers C. purchases of raw material D. Only answers A and B are explicit costs because the purchases of raw material is only an opportunity cost. E. Answers A, B, and C are all
Answer the following statement true (T) or false (F)
1) Demand is the active and supply the passive determinant of land rent. 2) Different rents on land reflect differences in the marginal revenue product of land. 3) The free-land era of U.S. history reflected a situation in which the quantity of land available at a zero price exceeded the quantity of land demanded. 4) Rent performs an incentive function, but no rationing function. 5) The interest rate is the price paid for the use of money.