Price ceiling on toasters

The question asked was suppose that the government imposes a price ceiling on toasters. In particular, suppose that it decrees that a toaster cannot sell for more than $14.00. Would the quantity supplied equal the quantity demanded? What sorts of devices may come into being to allocate the available supply of toasters to consumers? What problems would the government encounter in keeping the price at $14.00. What social purposes, if any, might such a price ceiling serve?

Gross Domestic Product

The question used this table that shows the value of GDP in the nation of Purintania. The figures shown are in millions of 1980 dollars and current dollars. I am not sure how to fill in the blanks. Year GDP (Millions) GDP (millions of current dollars) Current Price Level ---------------------- 1980 Price Level 1980 1,000 ________________ 1.00 1984 _______ 1,440 1.20 1988 ... click for more

Gross Domestic Product

The questions asked if a paper mill produces $1 million worth of paper this year but adds considerably to the pollutants in a nearby river, are the social costs arising from this pollution reflected in the gross domestic product? If so, how? Should these costs be reflected GDP? If so, why? I thought the answer would be no and that social costs are added and become the total net costs. I am not sure if the costs should be reflected in the GDP.

Aggregate Demand Curve

The question asked that suppose that the aggregate demand curve is P=120 - Q, where P is the price level and Q is real output (in billions of dollars). If the short-run aggregate supply curve (which is a horizontal line in the relevant range) shifts upward from P = 102 to P = 104, what happens to real output?

Aggregate Demand Curve

The question asked that suppose that the Organization of Petroleum Exporting Countries raises oil prices by 50 percent in 2005. What effect will thishave on the U.S. Aggregate demand curve? On the U.S. Short-run aggregate supply curve?