Government price guarantees for certain crops are an example of:
A.) A price floor.
B.) A price ceiling.
C.) A monopoly.
D.) The market mechanism.
A.) A price floor.
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In a graph that illustrates a perfectly competitive firm, marginal revenue is
A) a diagonal line that lies below the firm's demand curve. B) a line that intersects the firm's demand curve from below at its lowest point. C) the same as the firm's demand curve. D) a line that intersects the firm's average total cost curve from below at its lowest point.
The concept that producing goods and services generates the means and the willingness to purchase other goods and services is
A) the Keynesian approach. B) money illusion. C) Say's law. D) cost-push inflation.
In the last few decades, there has been:
A. very little growth in free trade worldwide. B. no growth in free trade worldwide. C. a decline in free trade worldwide. D. great growth in free trade worldwide.
The economic value which can be created by a transaction between two people, Ed (seller) and Luis (buyer), is $50 as Ed's opportunity cost of selling is $135 and Luis' valuation of the good is $185 . If each gains $25 from this transaction, which of the following conclusions can be drawn?
a. Transaction costs are zero. b. Luis has higher bargaining power than Ed. c. Ed has higher bargaining power than Luis. d. Transaction costs are positive.