Refer to the graph shown. An effective price floor at $8 imposes a deadweight loss of:
A. 100.
B. 90.
C. 25.
D. 45.
Answer: D
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A) must increase the demand for money. B) might increase or decrease the demand for money. C) must decrease the demand for money. D) affect only the supply of money. E) have no effect on the demand for money or on the supply of money.
Refer to Table 2-16. What is Estonia's opportunity cost of producing one board foot of lumber?
A) 0.2 cell phones B) 5 cell phones C) 8 cell phones D) 32 cell phones
Which of following is the best example of a monopoly if we use a broader definition of monopoly?
A) Santos Tacos, the only taqueria in the small town of Santosville B) Cheap Gas, one of two gasoline stations in a large rural community C) Spuds McKenzie, a wealthy potato farmer in Idaho D) Zippie Rentals, a sports car rental service in the downtown Boston area
In the case where money demand is completely interest insensitive (interest elasticity equals zero), an increase in the quantity of money will
a. increase income but leave the interest rate unchanged. b. increase income and lower the interest rate. c. lower the interest rate but leave income unchanged. d. leave both income and the interest rate unchanged.