The above figure shows supply and demand curves for apartment units in a large city. The area "c" represents
A) the loss in consumer surplus if a rent ceiling of $350 is imposed.
B) a transfer from producers to consumers if a rent ceiling of $350 is imposed.
C) a transfer from consumers to producers if a rent ceiling of $350 is imposed.
D) the total revenue received by supplying Q1 units.
B
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Which of the following is NOT a social cost of inflation?
A. The money that people hold loses value due to the inflation tax. B. People hold smaller real balances and so have to make more frequent trips to the bank. C. Firms have to spend money to change prices more frequently. D. Inflation leads to greater variability in the relative prices charged by firms.
If the purchasing power of a dollar is greater than the purchasing power of the yen, purchasing power parity would predict that
A) in the short run, interest rates will move to equalize the purchasing power of the dollar and the yen. B) in the long run, exchange rates will move to equalize the purchasing power of the dollar and the yen. C) in the short run, exchange rates will move to equalize the purchasing power of the dollar and the yen. D) in the long run, interest rates will move to equalize the purchasing power of the dollar and the yen.