When the market for a commodity is in equilibrium:
A) there will still be some unsold stock of the commodity.
B) all sellers of the commodity will want to change their behavior.
C) no economic agent will want to change his or her behavior.
D) all buyers of the commodity will want to change their behavior.
C
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The price elasticity of demand is a measure of the extent to which the quantity demanded of a good changes when ________ and all other influences on buyers' plans remain the same
A) income changes B) the price of a related good changes C) the price of the good changes D) the demand alone changes E) both the demand and the supply simultaneously change
If positive externalities are present in a free market, ________ at any output level
A) the marginal cost of production equals the average cost of production B) the marginal social cost of production exceeds the marginal private cost C) the marginal private benefit from production equals marginal social benefit D) the marginal social benefit of production exceeds marginal private benefit
Even when the demand for one good is high, the price of the good is also affected by supply. The textbook illustrates this by comparing the price of two items that were auctioned on the same day
Which of the following describes the results of the auction? A) A letter written by Abraham Lincoln sold for a higher price than a letter written by John Wilkes Booth. B) A letter written by John Wilkes Booth sold for a higher price than a letter written by Lee Harvey Oswald. C) A letter written by Abraham Lincoln was sold for a higher price than a letter written by Adam Smith. D) A letter written by John Wilkes Booth sold for a higher price than a letter written by Abraham Lincoln.
Refer to Figure 9-1. Suppose the government allows imports of leather footwear into the United States. The market price falls to $18. What is the value of domestic producer surplus?
A) $0 B) $40 C) $320 D) $360