Refer to the graph shown. In equilibrium, consumer surplus is equal to:
A. 1,400.
B. 600.
C. 1,200.
D. 2,000.
Answer: A
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"As consumption of a good increases, the extra satisfaction received from consuming an additional unit of the good decreases." This statement is known as the law of:
a. demand. b. increasing costs. c. diminishing marginal utility. d. diminishing marginal returns. e. total utility.
Aggregate expenditure means total or combined spending
a. True b. False Indicate whether the statement is true or false
In what way is the result of an excise tax imposed on either demanders or suppliers similar to the result of a price ceiling?
a. The amount that consumers pay for the good will be less than they previously paid b. The amount of the good that will be traded in the market will be less than previously traded c. both price ceilings and excise taxes create excess demand d. The amount that consumers pay for the good will be greater than they previously paid e. both price floors and excise taxes create excess supply
Those hurt by inflation include
a. labor unions with COLA clauses in their labor contracts b. borrowers who are indebted to banks and other lending institutions c. savers who hold checking and saving accounts in banks d. producers of goods such as automobiles, computers, and food e. owners of precious metals, antiques, and works of art