Suppose at the current price, the demand for copper is estimated at -3.14. What happens to sales revenue if the government imposes a price ceiling slightly below the free market equilibrium price in the copper market?
A) Sales revenue falls.
B) Sales revenue rises.
C) Sales revenue remains unchanged because copper is a necessity for most industries.
D) It cannot be determined without information on prices.
Answer: B
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Classical macroeconomic theorists believed that if there were more workers who wanted to work than there were firms who wanted to hire them, then wages would ________.
A. not change B. rise slowly C. resist falling D. fall quickly
What is the economic way of thinking, and why is it important?
What will be an ideal response?
Which of the following is true of deadweight loss?
a. It occurs when taxes are imposed on a market b. It occurs when there is a surplus in a market. c. It occurs when there is a shortage in an economy. d. It occurs when there is a budget deficit in an economy.
The primary criticism by Keynesians of the credibility argument for rules is that
A. rules that reduce presidential and congressional influence over monetary policy could ultimately be harmful to the economy. B. the cost of losing flexibility over policy choices may exceed the cost of gaining credibility. C. reputations are a less costly method of maintaining credibility. D. reputations are a less costly method of gaining credibility.