Refer to the graph shown. Assume the market is initially in equilibrium at point j in the graph but the imposition of a per-unit tax on this product shifts the supply curve up from S0 to S1. The effect of the tax is to raise equilibrium price from:
A. c to b.
B. d to b.
C. e to c.
D. d to c.
Answer: D
You might also like to view...
The decline in the value of the yen in 2014 and 2015 occurred as a result of the Japanese central bank, the Bank of Japan, following an expansionary monetary policy
Investors expected that the result would be lower nominal Japanese interest rates and a higher inflation rate. In response, investors ________, causing the value of the yen to decline against the dollar. A) bought Japanese yen and sold U.S. dollars B) bought Japanese yen and bought U.S. dollars C) sold Japanese yen and bought U.S. dollars D) sold Japanese yen and sold U.S. dollars
Government stabilization policy
a. cannot influence investment spending. b. can stimulate aggregate demand and thereby induce businesses to invest, but the amount is not totally predictable. c. can stimulate aggregate demand, but investment spending will not be affected. d. can stimulate aggregate demand, but only in the long run.