The interest rate compensates
a. bankers for their time spent on paperwork
b. borrowers for their increased consumption today
c. savers for consumption forgone today
d. consumers for more consumption today
e. the Fed for its efforts to control the money supply
C
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The above figure shows the market for blouses. The government decides to impose the sales tax on sellers, as shown in the figure. The government would raise more tax revenue from this excise tax if
A) the demand was more inelastic. B) it places a price ceiling on blouses in addition to the tax. C) it places a price floor on blouses in addition to the tax. D) all of the above.
Refer to the above table. If the price is $6, the perfectly competitive firm should produce
A) 104 units. B) 105 units. C) 106 units. D) 107 units.
If the equilibrium price of a good decreases and the equilibrium quantity of the good decreases, we can conclude that:
A. demand increased. B. demand decreased. C. supply increased. D. supply decreased.
One way of addressing the associated market failure that generates both private costs and external costs is for this activity to be
A. subsidized. B. left alone. C. banned. D. taxed.