When the market clearing price of gasoline after a hurricane spikes to $6.00 but legislators enact "anti-gouging" legislation that keeps prices at $4,
A) consumers as a whole will tend to benefit.
B) producers will have less incentive to bring gasoline to the areas where gasoline is most highly valued.
C) government will ensure that no shortages will develo
B
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Geraldo wants to purchase Marlena's 1914 prairie-style house so he can tear it down to build a 10,000 square foot home with space to operate his hypnotherapy practice
Marlena's great-grandfather built the 1914 house and she has no intention of selling it, especially to someone who wants to tear it down. The mayor, who is a friend and client of Geraldo, talks to Marlena and tells her that since Geraldo's proposed house would generate 20 times as much property tax for the city as Marlena's current house does, Marlena will need to either tear down the house herself and build a house comparable to the one Geraldo wants to build, or eminent domain will be used to force the sale of her house. In this case, the threat of eminent domain A) is in the best interest of society in general. B) would move a resource from someone who values it less to someone who values it more. C) gives people incentives to make second-best choices. D) would increase the size of the economic pie since property-tax revenues would increase.
An investment is profitable as long as its internal rate of return is equal to the rate of interest
Indicate whether the statement is true or false