Refer to the diagram. If actual production and consumption occur at Q2,
A. an efficiency loss (or deadweight loss) of e + f occurs.
B. efficiency is achieved.
C. an efficiency loss (or deadweight loss) of a + b + c + d occurs.
D. an efficiency loss (or deadweight loss) of a + c occurs.
Answer: B. efficiency is achieved.
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Which of the following relationships is likely to exhibit negative correlation?
A) The relationship between inflation in the U.S. and traffic congestion in China B) The relationship between amount saved with a bank and the interest earned C) The relationship between the amount of precipitation in a year and the number of umbrellas sold D) The relationship between level of professional training and unemployment
A situation in which money buys the same amount of goods and services in different currencies is called
A) a fixed exchange rate. B) purchasing power parity. C) exchange rate surplus. D) exchange rate equilibrium. E) exchange rate balance.
Calling long distance is often more expensive on weekdays between 8 am and 5 pm than in the evening hours. Why is this the case?
A) Telephone companies hope to discourage customers from calling long distance during the day to keep their labor costs down. B) Businesses who must call suppliers or customers during business hours have few alternatives and therefore have an inelastic demand during the workday compared to after-work hours. C) The cost of making long-distance connections is higher during the day than in the evenings. D) Increasingly, businesses who must call suppliers or customers during business hours resort to the internet, thereby reducing demand for long-distance calls. To make up for this fall in demand, telephone companies charge higher rates.
Compared to perfect competition, monopoly
a. provides less output. b. charges a higher price. c. results in higher cost (inefficient) production. d. All of the above are correct.