The above figure shows supply and demand curves for apartment units in a large city. If the city government passes a law that establishes $350 per month as the legal maximum rent, the loss in social welfare equals
A) b + c.
B) f.
C) a.
D) f + g.
D
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Explain the theory of optimum currency areas
What will be an ideal response?
If the value of a nation's merchandise imports exceeds merchandise exports, the nation is running a
a. balance of payments deficit. b. balance of payments surplus. c. merchandise trade deficit. d. merchandise trade surplus.
Which of the following statements best describes the price, output, and profit conditions of competitive price-searcher markets?
a. Price will equal marginal cost at the profit-maximizing level of output; profits will be positive in the long-run. b. Price will always equal average variable cost in the short run and either profits or losses may result in the long run. c. Marginal revenue will equal marginal cost at the short run, profit-maximizing level of output; in the long run, economic profit will be zero. d. Marginal revenue will equal average total cost in the short run; long-run economic profits will be zero.
If the final expressions in a present value equation used to calculate the price of a bond you are considering buying are "[$50 / (1 + .08)3] + [$500 / (1 + .08)3]", which of the following is correct?
A) The coupon is $50, the interest rate you need is 1.08 percent, and the coupon will mature in 3 years. B) The face value is $50, the interest rate you need is 8 percent, and the coupon will mature in 3 years. C) The face value is $500, the coupon is $50, and the coupon will mature in 3 years. D) The face value is $500, the interest rate you need is 3 percent, and the coupon will mature in 8 years.