Author Question: Sammy has a drone that he values at 1,500. Frank values the same drone at 1,000. The government ... (Read 227 times)

daltonest1984

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Sammy has a drone that he values at 1,500. Frank values the same drone at 1,000. The government offers a subsidy of 800 to the buyers of drones, and Sammy and Frank agree on a price of 1,600. The subsidy creates a deadweight loss of
 
  A) 0
  B) 200
  C) 500.
  D) 800.

Question 2

A major principle of economics is that people respond to incentives.
 
  Indicate whether the statement is true or false



jojobee318

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Answer to Question 1

C

Answer to Question 2

TRUE



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