When looking at this graph for the welfare effects of a subsidy, the location of the supply curve above the demand curve for each unit produced between Q1 and Q2 ______.
a. prevents the producers from being able to make enough goods to meet demand
b. prevents the development of a deadweight loss associated with the subsidy
c. shows that the cost of producing those units is lower than the marginal benefits to consumers
d. shows that the marginal benefits to consumers are less than society’s cost of producing those units
d. shows that the marginal benefits to consumers are less than society’s cost of producing those units
You might also like to view...
A Nash equilibrium with a noncredible threat as a component is:
A. not a perfect equilibrium. B. a somewhat perfect equilibrium. C. a sequential equilibrium. D. a perfect equilibrium.
Your city newspaper publishes a "Best of" poll that lists its readers' favorite restaurants. Mundo Bar and Grill is ranked as the best casual restaurant. Your best friend had dinner at Mundo Bar and Grill last week and commented that the food was mediocre and the service was slow. You decide not to have dinner at Mundo Bar and Grill based on your friend's experience. Your decision illustrates
that people a. are reluctant to change their minds. b. are overconfident. c. give too much weight to a small number of vivid observations. d. are satisficers.
Which of the following is the best example of a consumption good?
a. mp3 player b. farm c. factory d. bulldozer
If two firms are engaging in price fixing, and one firm lowers its price, the other firm will always interpret this as underpricing.
Answer the following statement true (T) or false (F)