1) If the government set a price floor at $24? -the price would rise to the equi
ID: 1163537 • Letter: 1
Question
1)
If the government set a price floor at $24?
-the price would rise to the equilibrium price.
-there would a temporary surplus, then prices would fall to equilibrium.
2)
Assuming the inner curve is the United States' current production possibilities frontier, which of the following points would eventually lead to the greatest level of economic growth?
-Point N
-Point P
-Point K
-Point J
3)
MC Qu. 114 If the econo...
-12 units of outboard motors.
-2 units of outboard motors.
-4 units of outboard motors.
-11 units of robots.
microeconomic
S- 40 32 24 16 DI 8 0 10 20 30 40 50 60Explanation / Answer
(1) Option (1)
Since the floor price is higher than equilibrium price, quantity demanded will fall and quantity supplied will rise, creating a surplus. But a government imposed price floor means that price cannot fall below this level, therefore price will rise to $24.
(2) Option (4)
The more the amount of capital goods being produced, the higher will the growth rate be.
(3) Option (3)
At point D, number of Robots = 11 and number of Outboard motors = 12
At point C, number of Robots = 15 and number of Outboard motors = 8
Opportunity cost = Decrease in number of outboard motors = 12 - 8 = 4
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