The price of an airline ticket from Denver to Washington, D.C. costs $600. A bus ticket costs $150. Traveling by plane takes 6 hours compared with 51 hours by bus. Other things constant, an individual would gain by choosing air travel if, and only if, his time were valued at more than

If an economy initially starts away from the steady state ________

A) output will gradually fall over time B) the economy will converge to the steady state in the long-run C) consumption spending must be greater than investment spending D) consumption spending must rise

The above figure shows supply and demand curves for milk. If the government passes a $2 per gallon specific tax, the loss in producer surplus will equal

A) b + c + f + g. B) f + g. C) b + f. D) c + g.