Figure 17-12
If the country illustrated in is initially trading without restrictions at a world price of $1.00, the gain in producer surplus as a result of a tariff of $0.50 per unit is represented by area
a.
c + h
b.
h
c.
c
d.
c + g
e.
g
c
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Because there is an imbalance of information in a lending situation, we must deal with the problems of adverse selection and moral hazard. Define these terms and explain how financial intermediaries can reduce these problems
What will be an ideal response?
Which of the following best illustrates the human capital of a survivor stranded on an island?
a. the fishing poles she has produced b. the invention of a better fishing lure c. the fresh fruit and fish on and around the island d. her previous training in a survival course
When investors become irrationally optimistic that an asset's price will continue to rise, it causes a financial bubble to:
A. become doubted by most serious investors. B. start to inflate. C. be on the verge of bursting. D. burst.
Cross elasticity is defined as the ________________.
A. percentage change in price of a one good (A), divided by the percentage change in the quantity demanded of a related good (B) B. percentage change in quantity demanded for one good (A), divided by the percentage change in the price of a related good (B) C. percentage change in quantity demanded for one good (A), divided by the percentage change in the price of that good (A) D. change in quantity demanded for one good (A), divided by the change in the price of a related good (B)