A price floor represents
A) a maximum price that can be legally charged for a product or service.
B) a minimum price that can be legally charged for a good or service.
C) a lottery imposed upon producers by the government.
D) a first come, first served mechanism for controlling prices.
B
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In banking-oriented systems, handling of the manager-stockholder conflict in large firms is through
A) rating agencies. B) the potential for takeovers. C) management ownership of the firm. D) bank ownership of the firm.
If the government imposes a specific tax on a monopoly, the consumer's tax incidence
A) can exceed 100%. B) will always be between 0-100%. C) may be negative. D) will be the same as when the tax is imposed on a perfectly competitive firm.
An antitrust agency is identifying the product market for Good X and determines that Good X and Good Y have a cross-price elasticity of 0.01. As a result of the cross-price elasticity, the antitrust agency is likely to ________ Good Y from Good X's product market as the products ________ compete as close substitutes.
A) exclude; do B) include; do C) exclude; do not D) include; do not
An indication that the economy is in recession, e.g., a rise in the number of used clothing stores for babies, suggests that
a. used clothes for babies are a necessity b. used clothes for babies are an inferior good c. used clothes for babies are a normal good d. new clothes for babies are a luxury e. used clothes for babies have price-elastic demand