Producer surplus is always the total area below the demand curve and above the supply curve
a. True
b. False
Indicate whether the statement is true or false
False
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The problem of "double marginalization" is
a. The retail price being too high due to an inclusion of both manufacturer and retailer markup b. The retail price being too low due to an exclusion of both manufacturer and retailer markup c. The retail price being too high due to an exclusion of manufacturer markup d. The retail price being too low due to an exclusion of retailer markup
If the FOMC purchases government bonds priced at $5,000 from a bond dealer who banks at National Bank, and if the reserve requirement is 20 percent, then the required reserves of National Bank:
a. increase by $5,000. b. increase by $4,000. c. increase by $1,000. d. decrease by $5,000. e. decrease by $1,000.
David is willing to pay $30 for a watch which sells at a market price of $20 . The consumer surplus received by David if he buys the watch is $10
a. True b. False Indicate whether the statement is true or false
In the markets for goods and services in the circular-flow diagram,
a. households provide firms with savings for investment. b. households provide firms with labor, land, and capital. c. firms provide households with output. d. firms provide households with profit.