Price controls
a. are always popular with consumers because they lower prices.
b. create shortages.
c. increase producer surplus because firms can now sell a greater quantity of a good at a lower price.
d. are necessary to preserve equity.
b
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"If the inflation rate is positive, then the real interest rate is greater than the nominal interest rate." Is the previous statement correct or incorrect? Explain your answer
What will be an ideal response?
Suppose the demand for barley is perfectly elastic. The supply curve of barley is upward sloping. If a tax is imposed on barley,
A) barley sellers pay the entire tax. B) barley buyers pay the entire tax. C) the government pays the entire tax. D) the tax is split evenly between barley buyers and sellers. E) who pays the tax depends on whether the government imposes the tax on barley sellers or on barley buyers.