Producer surplus is the:
A. amount by which the quantity supplied of a good exceeds the quantity demanded of a good.
B. value of the sum of producers' willingness to sell a good plus the price of the good.
C. measure of how much producers value a good.
D. value of the difference between the actual selling price of a good and the price producers are willing to sell it for on the supply curve.
Answer: D
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If the price level rises and the money wage rate remains constant, what happens to the quantity of real GDP supplied? Along which aggregate supply curve does the economy move?
What will be an ideal response?
If wages and prices are flexible, an anticipated change in the money supply has no effect on
A) money demand. B) nominal interest rates. C) real GDP. D) the inflation rate.
Refer to Figure 10.1. If the level of real GDP is initially Y3, firms will ________ production until equilibrium is reached at ________
A) increase; Y3 B) decrease; Y3 C) increase; Y1 D) decrease; Y1
A tariff is best described as a
A. tax on exported goods. B. a tax on a good that is imported. C. payment by the government to domestic producers to improve their competitive position in world markets. D. transfer payment.