Assume the market is in equilibrium in the graph shown at demand D and supply S1. If the supply curve shifts to S2, and a new equilibrium is reached, which of the following is true?
A. Consumer surplus increases, and total surplus increases.
B. Consumer surplus decreases, and total surplus increases.
C. Consumer surplus increases, and total surplus decreases.
D. Consumer surplus decreases, and total surplus decreases.
A. Consumer surplus increases, and total surplus increases.
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Refer to Table 2-14. What is Scotland's opportunity cost of producing one motorcycle?
A) 0.25 guitar B) 4 guitars C) 12 guitars D) 16 guitars
See Scenario 4.1. What is Daniel's income-consumption curve?
A) Pc = Pd B) Pc = Qc C) Qd = I - 3Qc D) Qc = Qd E) all of the above
A pollution tax is:
a. a positive externality used to offset a negative one b. a price per unit of discharge of pollution c. a tax on pollution control equipment d. itself a form of negative externality
Maria decides to buy a dress from Lisa; they agree on a price of $20. Which of the following best describes who gains and who loses from the transaction?
a. Both Maria and Lisa expect to gain from this transaction. b. If Lisa gains from the transaction, Maria must lose an equal amount. c. If the dress originally costs more than $20, Maria gains and Lisa loses. d. If the dress originally costs less than $20, Lisa gains and Maria loses