For a particular product, an effective price ceiling results in
A. quantity demanded greater than quantity supplied.
B. quantity demanded equal to quantity supplied.
C. demand equal to supply.
D. quantity supplied greater than quantity demanded.
Answer: A
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Differences in innate skills and the benefits associated with the division of labor result in
A) diminishing returns. B) self-sufficiency. C) absolute advantage. D) differences in productivity.
When the tax rate increases, the tax revenue
A) always increases. B) does not change. C) always decreases. D) may increase or decrease.
Which of the following is a stock variable?
a. Government spending b. Investment c. Daily household consumption d. Saving e. Wealth
The United States sees its overall price level decline, ceteris paribus. Considering this, which of the following actions would most likely happen next?
a. U.S. firms invest more money in bonds and savings accounts, which lowers interest rates. b. U.S. consumers spend less money, which increases the quantity of real GDP demanded. c. U.S. firms hold more money to buy goods and services, which raises interest rates. d. U.S. households borrow more money, which decreases the demand for loanable funds.