Economists generally agree that price controls in the U.S. would
A. increase prices to consumers.
B. increase the motivation to invent new drugs and diminish profits to drug companies.
C. increase the motivation to invent new drugs.
D. diminish profits to drug companies.
Answer: D
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The total amount of producer surplus in a market is equal to the area above the market supply curve and below the market price
Indicate whether the statement is true or false
Mr. Peabody chooses to invest in companies that produce goods and services based on consumer preferences. Mr. Peabody is investing in companies that are attempting to be
A) guaranteed to make a profit. B) allocatively efficient. C) productively efficient. D) all of the above
Situation 35-2 ? Dan and Ann live in the same community and both can participate in two activities, producing and stealing. Refer to Situation 35-2. Ann spends 8 hours of each day producing and 1 hour of each day stealing. It is probably the case for her that
A. at some point the MB/MC ratio for producing fell below the MB/MC ratio for stealing. B. her MB/MC ratio for producing was always greater than her MB/MC ratio for stealing. C. her MB/MC ratio for producing never changed, no matter how much or how little she produced. D. her MB/MC ratio for stealing never changed, no matter how much or how little she stole. E. There is not enough information to answer the question.
The Phillips curve describes a negative relationship between unemployment and inflation
a. True b. False Indicate whether the statement is true or false