Suppose Sam buys a good for $100 at a yard sale. If consumer surplus from the sale is $75, Sam would have been willing to pay:
a. $100 b. $175.
c. $25 d. equal to the deadweight loss.
b
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Optimal commodity taxation would
A. put a tax on leisure time, which is currently untaxed. B. have the smallest amount of excess burden possible for a given amount of tax revenue. C. optimize tax rates on the wealthiest Americans. D. eliminate tax evasion in the United States.
When the housing bubble popped, the effect of the negative demand side shock and the negative supply side shock were the same on:
A. output, causing it to definitely decrease. B. prices, causing them to definitely rise. C. output, causing it to definitely increase. D. prices, causing them to definitely fall.
Excess reserves equal total reserves plus required reserves
a. True b. False Indicate whether the statement is true or false
Mutual interdependence means that: a. each firm faces a perfectly elastic demand curve
b. each firm faces a perfectly inelastic demand curve. c. firms choose price and output simultaneously. d. firms must anticipate the possible reaction of rivals to their own economic behavior.