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A price ceiling will be binding only if it is set
below the equilibrium price.
1. Suppose there is a 5% increase in the price of good X and there is a resulting 9% decrease in the quantity of the good X demanded. Price of elasticity of demand for X is...
a low tax is increased than when a high tax is increased.
Jeffery visits a sporting goods store to buy a new set of gold clubs. He is willing to pay $750 for the clubs, but buys them on sale for $525. Jeffery’s consumer surplus from the purchase is
What is the equilibrium price and what is the equilibrium quantity?
If the government imposes a binding price ceiling on Levi’s jeans, set at a price of $25, what is the new quantity supplied?
Consumer surplus before the tax is equal to...
The tax incidence bore by the sellers because of the tax is equal to...
The quantity of labor supplied is 2 million hours and the quantity of labor demanded is 4 million hours.
For a U-shaped ATC curve, when the MC curve is below the ATC curve, the average total cost curve must be ___.
when the MC curve is above the ATC curve the ATC curve must be ____.
the marginal cost curve intersects the average total cost curve at its ____.
iii. If P <ATC
Short Run Supply Curve and the Long Run Supply Curve for the PC Firm.
i. If P >ATC, the firm produces on the MC curve
ii. If P <ATC, the firm should EXIT the market
What happens to the market and firm in the long run if there is profit or if thereis losses?
If profit is MR/P/AR is above ATC
Zero Profit Condition (Long Run Equilibrium)
a. At end ofthis process of entry and ext, firms that remain in the market must be making zero economic profit
b. Process ofentry and exit ends only when P andATC are driven to equality
c. Firmsprofit: P = (P – ATC) x Q
His sermon defines the first great awakening in America; had a tone that put “the fear of god” in people and was very much targeting emotions (to know God is to “feel” God), wanted people to realize how far they’d strayed from God and to repent
How does the audience for Part I of Franklin’s Autobiography differ from the audience in parts II and III?
How does Franklin construct an American identity in his Autobiography?
What is Franklin’s relationship to the Enlightenment Movement?
What is the Enlightenment Movement?
A cultural movement that emphasizes science and learning (logic, observation, and experimentation) rather than superstition and occult beliefs in the realms of the invisible. Religion is no longer ultimate authority. “age of reason”
How does Jefferson’s work fit into the genre of the scientific treatise?
He infuses texts with rational arguments steeped in observations and “logical conclusions. Notes-Seminole text
What are three features of the scientific treatise as a genre?
What are three features of the Indian autobiography?
What are three themes Occom writes about in his autobiography?
How does “The Contrast” define American values in contrast to European values?
What is the Comedy of Manners?
How does Royall Tyler utilize satire in his play?
Cooper writes in the genre of the Romance. What is the specific sub-genre of Last of the Mohicans?
What is Romanticism?
Why is Last of the Mohicans historical fiction?
sins, humanity, mortality/death/heaven/hell, Puritanism and idea of man’s inherent deprevity
How does the theme of ‘inherent depravity’ manifest in Hawthorne’s literature?
How does Hawthorne’s view of ‘inherent depravity’ differ from that of the Transcendentalist?
What is the rhetorical purpose of Apess’s “Indian’s Looking-Glass”?
How does Apess’s autobiography differ from Occom’s?
What is the cultural significance of Apess’s writings?
— What is Transcendentalism?
How does Emerson’s essay reflect the values of Transcendentalism?
Why is Emerson known as the ‘father of American literature’?
Helps initiate Transcendental movement; helped to create an “American” literary voice through his poetry and essays
In the first chapter of Walden, Thoreau advocates simple living. What does he say are the four necessities of life?
How does the poetic style of Emily Dickinson differ from other early American poets?
How does the poetic style of Walt Whitman differ from other early American poets?
Why is Walt Whitman known as the ‘father of free verse’?
His work broke the boundaries of poetic form and was generally prose-like
What is circumference as used in Dickinson’s poetry?
— Explain Whitman’s idea of the Oversoul.
What is the essential difference between Dickinson’s idea of circumference and Whitman’s idea of the oversoul?
The slave narrative is a descendant of the captivity narrative. How does the slave narrative differ in terms of plot structure from the captivity narrative?
— What is the difference in audience between Jacobs’s and Douglass’s narratives?
— What is the difference in rhetorical purpose between Jacobs’s and Douglass’s narratives?
Why does Harriet Jacobs write her narrative under the pseudonym Linda Brent?
Who are the protagonist and antagonist of the slave narrative?
the amount a seller is paid for a good minus the seller’s cost of production
Using midpoint method, between prices of $48 and $54, price elasticity of demand is about
At a price of $30 per unit, sellers' total revenue equals
$30 x 15
23. The presence of a price control in a market for a good or service usually is an indication that
Policymakers believed that the price that prevailed in that market in the absence of price controls was unfair to buyers or sellers.
policymakers use taxes
both to raise revenue for public purposes and to influence market outcomes
Suppose the government has imposed a pricefloor on the market for soybeans. Whichof the following events could transform the
Farmers use improved, draught-resistant seeds, which lowers the cost of growing soybeans.
a government-imposed price of $6 in this market could be an example of a
binding price ceiling and non-binding price floor
In which market will the majority of the tax burden fall on buyers?
In which market will the majority of the tax burden fall on sellers?
Which of the following was not a result of the luxury tax imposed by Congress in 1990?
The tax was never repealed or even modified.
Willingness to pay
measures the value that a buyer places on a good.
A demand curve reflects each of the following except the
ability of buyers to obtain the quantity they desire.
consumer surplus is equal to the
Value to buyers- Amount paid by buyers
In a market, the marginal buyer is the buyer
who would be the first to leave the market if the price were any higher
As a result of a decrease in price,
new buyers enter the market, increasing consumer surplus.
Another way to think of the marginal seller is the seller who
would leave the market first if the price were any lower.
At the equilibrium price, consumer surplus is
At the equilibrium price, producer surplus is
At the equilibrium price, total surplus is
If the government imposes a price ceiling of $60 in this market, the total surplus will be
ceiling is above equilibrium so it is not binding resulting in the total surplus to remain at equilibrium price of $250
If the government imposes a price floor of $60 in this market, then the total surplus will be
price floor is above equilibrium so binding.
total surplus after floor= total surplus before - DWL $187.50
If the government allowed a free market for transplant organs such as kidneys to exist, the
shortage of organs would be eliminated, and there would be no surplus of organs.
Inefficiency can be caused in a market by the presence of
market power, externalities, and imperfectly competitive markets.
When a tax is imposed on a good
the equilibrium quantity of the good always decreases
The imposition of the tax causes the price paid by buyers to
increase by $3
The imposition of the tax causes the price received by sellers to
decrease by $2
The amount of tax revenue received by the government is
The amount of deadweight loss as a result of the tax is
The loss of consumer surplus as a result of the tax is
The loss of producer surplus as a result of the tax is
The price elasticities of supply and demand affect
both the size of the deadweight loss from a tax and the tax incidence. Tax incidence creates a wedge in between what buyers will pay and sellers will receive.
Which of the following statements is correct regarding a tax on a good and the resulting deadweight loss?
The greater are the price elasticities of supply and demand, the greater is the deadweight loss.
The curve that is shown on the figure is called the
If the economy is at point A on the curve, then a small increase in the tax rate will
increase the deadweight loss of the tax and increase tax revenue.
Taxes are costly to market participants because they
transfer resources from market participants to the government, alter incentives, and distort market outcomes.
Is the good excludable? That is, can people be prevented from using the good?
Is the good rivalry in consumption? That is, does one person’s use of the good reduce another person’s ability to use it?