Suppose the market clearing price for gasoline is $3.75 per gallon. Now suppose that policy makers pass a law requiring that the maximum price that can be charged is $2.75 per gallon. Such a situation is an example of
A) a price control that will lead to a surplus of gasoline on the market.
B) a price floor that will lead to a shortage of gasoline on the market.
C) a price ceiling that will lead to a shortage of gasoline on the market.
D) a price floor that will lead to a surplus of gasoline on the market.
C
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An outward shift of the production possibilities curve represents
A) economic contraction. B) economic growth. C) economic recession. D) economic inflation.
Which approach to calculating GDP is computed using compensation of employees, rental income, profits, net interest, indirect business taxes, and depreciation?
a. The expenditure approach. b. The income approach. c. The product-market approach. d. The circular-flow approach.
If the PPF for two goods is a downward-sloping straight line, the resources used to produce those goods are equally well suited to the production of both goods
Indicate whether the statement is true or false
How can governments intervene in trade?
A. by producing cheaper products B. by helping reduce economic uncertainty C. by not buying products from competing countries D. All of these