True or false: Any price other than the equilibrium price will always result in less total...
True or false: Any price other than the equilibrium price will always result in less total surplus in the economy, or, equivalently, some deadweight loss.
Homework Answers
True
Equilibrium price results in equating quantity demanded and quantity supplied equal to each other so that the economic surplus is maximized. If price is greater than or less than the equilibrium price, market quantity is less than equilibrium quantity which implies surplus is not maximum.
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True or false: Any price other than the equilibrium price will
always result in less total...
True or false? (2 points) A price-discriminating monopolist will always create deadweight loss. (2 points) A...
True or false? (2 points) A price-discriminating monopolist will always create deadweight loss. (2 points) A monopoly market has barriers to entry and no close substitutes. (2 points) Unlike the monopolist, a monopolist creates an efficient market by payer workers less. (2 points) All else equal, the lower the price, the higher the consumer surplus. (2 points) A tax on buyers does not change the producer surplus because it is paid by consumers.
5) Before it matures, the price of any bond is always less than its face value....
5) Before it matures, the price of any bond is always less than its face value. A) True B) False
True False-Ambiguous and Explain why 8. The equilibrium price of coal is $50 per ton. Coal...
True False-Ambiguous and Explain why 8. The equilibrium price of coal is $50 per ton. Coal generates a negative externality of $30 per ton. Therefore, a tax will reduce the deadweight loss and reduce producer surplus.
For the questions below, answer either true or false. If you answer true, explain why it...
For the questions below, answer either true or false. If you answer true, explain why it is true. If you answer false, give a counter-example. In all three examples you may assume demand slopes downward and supply slopes upward (that is, neither curve is either perfectly vertical or horizontal), and that both curves are smooth (like they are in the rent control questions, not discrete like they were in homework 2). A. In the simple model of supply and demand...
Conceptual Questions A. For the questions below, answer either true or false. If you answer true,...
Conceptual Questions A. For the questions below, answer either true or false. If you answer true, explain why it is true. If you answer false, give a counter-example. In all three examples you may assume demand slopes downward and supply slopes upward (that is, neither curve is either perfectly vertical or horizontal), and that both curves are smooth (like they are in the rent control questions, not discrete like they were in homework 2). • In the simple model of...
1) True or False: For any two events, A and B, conditional probability is always less...
1) True or False: For any two events, A and B, conditional probability is always less than unconditional probability, i.e. P[B|A] < P[B].
True-False-Ambiguous and Explain why 7. The equilibrium price of coal is $50 per ton. Coal generates...
True-False-Ambiguous and Explain why 7. The equilibrium price of coal is $50 per ton. Coal generates a negative externality of $20 per ton, but then the negative externality increases to $40 per ton. Therefore, consumer surplus will increase and the deadweight loss will grow. Draw a graph.
QUESTION 4 If the price of a good is lower than the equilibrium price: consumer surplus...
QUESTION 4 If the price of a good is lower than the equilibrium price: consumer surplus is decreased and deadweight loss is increased. consumer surplus is increased and deadweight loss is decreased. producer surplus is decreased and deadweight loss is increased producer surplus is decreased and deadweight loss is decreased. QUESTION 42 If I get a meningitis vaccination shot, there's a reduced chance that others around me will get meningitis. This is an example of external cost external benefit common...
Suppose Price Control B is imposed as a price ceiling. Characterize the situation in the market...
Suppose Price Control B is imposed as a price ceiling. Characterize the situation in the market by selecting all of the correct responses below: Price (S) Price Control B is O A. a binding price ceiling. O B. a non-binding price ceiling. When Price Control B is imposed as a price ceiling. O A. the quantity sold in the market will be equal to the equilibrium quantity OB. the quantity sold in the market will be less than the equilibrium...
Say whether the statement is True or False. If False, supply a reason or correct the...
Say whether the statement is True or False. If False, supply a reason or correct the statement. (a) Producer Surplus is the profit that producers get. (b) Consumer Surplus represents savings. (c) When price is at equilibrium, producer and consumer surplus are equal (d) Deadweight Loss represents goods that cannot be bought or sold due to deviations of price from equilibrium (e) Deviations have a tendency to go back to equilibrium because the government makes price interventions
5) Before it matures, the price of any bond is always less than its face value. A) True B) False
True False-Ambiguous and Explain why 8. The equilibrium price of coal is $50 per ton. Coal generates a negative externality of $30 per ton. Therefore, a tax will reduce the deadweight loss and reduce producer surplus.
For the questions below, answer either true or false. If you answer true, explain why it is true. If you answer false, give a counter-example. In all three examples you may assume demand slopes downward and supply slopes upward (that is, neither curve is either perfectly vertical or horizontal), and that both curves are smooth (like they are in the rent control questions, not discrete like they were in homework 2). A. In the simple model of supply and demand...
Conceptual Questions A. For the questions below, answer either true or false. If you answer true, explain why it is true. If you answer false, give a counter-example. In all three examples you may assume demand slopes downward and supply slopes upward (that is, neither curve is either perfectly vertical or horizontal), and that both curves are smooth (like they are in the rent control questions, not discrete like they were in homework 2). • In the simple model of...
True-False-Ambiguous and Explain why 7. The equilibrium price of coal is $50 per ton. Coal generates a negative externality of $20 per ton, but then the negative externality increases to $40 per ton. Therefore, consumer surplus will increase and the deadweight loss will grow. Draw a graph.
QUESTION 4 If the price of a good is lower than the equilibrium price: consumer surplus is decreased and deadweight loss is increased. consumer surplus is increased and deadweight loss is decreased. producer surplus is decreased and deadweight loss is increased producer surplus is decreased and deadweight loss is decreased. QUESTION 42 If I get a meningitis vaccination shot, there's a reduced chance that others around me will get meningitis. This is an example of external cost external benefit common...
Suppose Price Control B is imposed as a price ceiling. Characterize the situation in the market by selecting all of the correct responses below: Price (S) Price Control B is O A. a binding price ceiling. O B. a non-binding price ceiling. When Price Control B is imposed as a price ceiling. O A. the quantity sold in the market will be equal to the equilibrium quantity OB. the quantity sold in the market will be less than the equilibrium...
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