Refer to the accompanying figure. If the government imposed a price ceiling of $40, what would happen in this market?
A. There would be excess supply.
B. The equilibrium quantity would fall.
C. The price ceiling would have no effect.
D. There would be excess demand.
Answer: C
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A) support; increases B) support; decreases C) oppose; increases D) oppose; decreases E) support; has no effect on
Classical macroeconomic theory was discredited and gave way to the first Keynesian approach as a result of
A) the collapse of the gold standard at the outset of World War I. B) the Great Depression of the 1930s. C) the wage-price controls of World War II. D) the rapid inflation of the late 1960s. E) the switch from fixed to flexible exchange rates in the early 1970s.
If one euro is equal to 0. 60 U.S. dollars, what would be the euro price of a car that costs $10,000?
A. 16,667 euros. B. 5,000 euros. C. 10,000 euros. D. 60,000 euros.
The Reliable Auto Repair Shop is earning a total revenue of $7,000. Its total fixed costs are $700, and its total variable costs are $2,500. The Reliable Auto Repair Shop?s profit is
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