Economists make assumptions to
a. provide issues for political discussion.
b. make a complex world easier to understand.
c. make it easier to teach economic concepts and analysis.
d. create policy alternatives that are incomplete or subject to criticism.
b
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To have an effect on the market, a price floor should be set at a price
A. above the equilibrium price. B. equal to the equilibrium price. C. below the equilibrium price. D. at any price on the supply curve.
The price of a PC falls or the price of an MP3 download rises? (Draw the diagrams!)
What will be an ideal response?
A conglomerate merger is a combination of
a. firms that formerly competed with each other. b. firms that formerly bought from and sold to each other. c. firms that produce nearly identical products, but are based in different countries. d. firms that produce unrelated products or services.
Refer to the above graph. If total costs increase and the price of oil stays at $60, then the firm will extract:
Use the following graph to answer question. It shows the extraction costs for TX Oil Company
in the first year in a situation where it will extract oil from a reserve over two years.
A. More oil the current year
B. Less oil the current year
C. Less oil in the next year
D. Make no change in oil production from one year to the next