Refer to Figure 4-2. What area represents producer surplus at a price of P1?
A) A + C B) A + C + E C) C D) C + E
C
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Refer to the following graphs to answer the question below.
Select the graph above that best shows the changes in demand and supply in the market for music CDs sold in stores, if more consumers switch to music-downloads from the Internet, and the cost of making music CDs decreases because of technological improvement in production.
A. graph (1) B. graph (2) C. graph (3) D. graph (4)
Which of the following events illustrates the law of demand: Other things remaining the same, a rise in the price of a good will ________
A. decrease the quantity demanded of that good B. increase the demand for a substitute of that good C. decrease the demand for the good D. increase the demand for a complement of that good
If your bank receives a demand deposit of $20,000 . and the banking system makes loans totaling $180,000 . which is the maximum possible, then the legal reserve requirement must be
a. 0.10 b. 0.20 c. 0.25 d. 0.40 e. 0.50
Suppose a labor-augmenting technology were developed for a product that increased the marginal product of labor for all workers. Which of the following would happen in the labor market for this product?
a. Demand would decrease. b. Demand would increase. c. Supply would decrease. d. Supply would increase.