According to the graph shown, if the market goes from equilibrium to having its price set at $10:
A. deadweight loss will occur.
B. seven fewer units will be exchanged.
C. consumer surplus will decrease.
D. All of these are true.
D. All of these are true.
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How long does it take prices of securities to adjust so as to eliminate arbitrage profits?
A) seconds B) hours C) days D) months
Transfer payments are included in which category under the expenditure approach to GDP accounting?
a. consumption b. government purchases c. net exports d. Transfer payments are not directly included in GDP calculations.
Recently, the owner of KFC Franchise decided to change how she compensated her top manager. Last year, the manager received a fixed salary of GHC50,000 and KFC made GHC110,000 in profits (excluding the manager’s compensation). She feared that her store’s performance was connected to the top manager shirking on the job and expected that changes to her top manager’s compensation structure would improve sales. Therefore, this year she decided to offer him a fixed salary of $40,000 plus 5 percent of the store’s profit. Since the change, the store is performing much better, and she forecasts profits this year to be $300,000 (again, excluding the manager’s compensation). Assuming the change of compensation is the reason for
Empirical work that does not account for differences in the productivity of workers
a. is unlikely to find evidence of wage differentials. b. can provide strong evidence of labor market discrimination. c. is likely to misinterpret apparent evidence of labor market discrimination. d. is accepted as superior to empirical work that does correct for differences in productivity of workers.