The figure below shows the supply and demand curves for jeans in Smallville.
Suppose jeans initially sell for $60 per pair. If the price of jeans falls to $40 per pair, then total economic surplus will increase by ________ per day.
A. $40
B. $20
C. $80
D. $160
Answer: D
You might also like to view...
Shares of stock are:
A. legal promises to make regular payments to the stockholder. B. claims to partial ownership of a firm. C. legal promises to repay a debt. D. regular payments made to owners of a firm.
Assume that the money stock is the intermediate target and money demand is totally interest- inelastic. Then, the
a. LM schedule will be horizontal. b. LM curve schedule would be vertical. c. IS curve would be horizontal. d. None of the above
An inferior good has an income elasticity of demand that is
A) positive. B) negative. C) positive but less than 1. D) zero.
Refer to the diagram, where S d and D d are the domestic supply and demand for a product and P c is the world price of that product. With a per-unit tariff in the amount P c P t , price and total quantity sold will be:
A. P t and x.
B. P c and z.
C. P t and y.
D. P a and x.