For a given market demand curve, if the market clearing price increases, then the amount of producer surplus will
A) decrease.
B) increase.
C) become negative.
D) none of the above due to insufficient information.
Answer: B
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If Carla can pick more oranges in one hour than Benjamin, then Carla definitely has a comparative advantage in picking oranges
Indicate whether the statement is true or false
A sustained increase in total output is possible only if the aggregate
A. Supply curve shifts to the right. B. Supply curve shifts to the left. C. Demand curve shifts to the left. D. Demand curve shifts to the right.
If quantity demanded for rice decreases by 4% when the price of rice increases by 8%, we know that the price elasticity of rice is equal to:
a. -2.5 b. -0.5 c. -2.0 d. -0.4
In the long run, the perfectly competitive firm
A) does not have a shut down price. B) earns only a normal profit. C) may produce even if it suffers a loss. D) earns an economic profit.